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Research Article

A Study on Differences in Price Promotion Forms by Product Type

Kim, Seongyeong

Korea National Open University

Published: January 2003 · Vol. 32, No. 3 · pp. 733-749
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Abstract

This study examines the different patterns of price promotion across product categories. Even if there are various factors which may have influence on the patterns of price promotion, product loyalty is regarded as a determining factor. It is hypothesized that products with high loyalty level are likely to promote less frequently with large price discount and products with low loyalty level are likely to promote more frequently with small price discount. The hypotheses are put to test with analytical and numerical studies. After analytically reexamined, the hypothesis was empirically tested with price data and survey data. The empirical results generally supported the hypothesis on the frequency of price promotion.
Keywords: depth of price promotionfrequency of price promotionGEEGeneralized Estimating Equationsloyaltyprice promotion