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A minimum discount level for a consideration set

Authors Han, Sangman
Gupta, Sunil
Lehmann, Donald R.
Issue Date 1994-05
Summary We examine the role of price discounts in the consideration set formation. Price discounts affect the consideration set by determining the size and membership of the consideration sets of consumers. A consumer compares the price discount with his/her threshold value at that purchase occasion. A given brand belongs to the consideration set of a consumer if the discount is above a certain threshold value. If the discount reach the threshold, the brand does not enter the consideration set. We propose a model in which the threshold is modeled as a probabilistic variable which varies by brands, across consumers and over time.
Language English
Format Working paper
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