The effect of monetary promotions on the purchase intention of hedonic versus utilitarian products when experiencing financial scarcity

Abstract

The purpose of this research was to examine the possible moderating effect of financial scarcity on the effect of monetary promotions of hedonic and utilitarian products. A 2×2 between-subjects design (monetary promotion vs. no promotion × utilitarian product versus hedonic product) was used to study product offering attractiveness and purchase intention of consumers under different experiences of financial scarcity, included as a covariate. The 265 respondents participated to the study, where randomly divided into the different groups. The chosen hedonic and utilitarian products were, respectively, crisps and rice. The results showed the effectiveness of a monetary promotion is differing per product type. In addition, financial scarcity has a moderating effect on the attractiveness and purchase intention of a product offering (with or without a promotion). Thus, consumers who experience financial scarcity differ from the consumers who do not.