Article title: An Examination of Construal Effects on Price Perceptions in the Advance Selling of Experience Services
Service research in the advance selling of experience services is limited in regard to how individual and situational differences influence price information processing. Consider the purchase of tickets to a concert, play, sporting event, or other performances and events with set capacities on given dates. Individuals predict or perceive the value depending on whether the event will take place sooner or later (temporal distance), what they believe about the value of the tickets personally relative to how others in the market value the tickets (social distance), and whether the event is located nearby or far away (spatial distance). In this study, authors investigate how these aspects of psychological distance influence perceived value and price sensitivity in two field studies involving the advance selling of tickets. They examine price information processing in the context of the advance selling of experience services. This research can impact the field by offering practitioners guidance in identifying who, when and where buyers of experiences are likely to be more or less price sensitive and perceive more or less value. This information helps managers to deliver the right offers or, at least, frame their current offerings more effectively.
Service research in the advance selling of experience services is limited in regard to how individual and situational differences influence price information processing. Applying construal-level theory in the context of advance selling of tickets for experience services, this research demonstrates that who (near vs. far social distance), when (near vs. far temporal distance), and where (spatial distance) influence price sensitivity and perceived value of the experience service. Study 1 finds that consumers are more price sensitive when they consider the advance purchase of events taking place further in the future, unless they are experienced, as Study 2 finds. Across both studies, buyers perceive greater value when the time and location of the event are psychologically near. Compared to when social distance is near (self-reference), consumers construe other average buyers in the market to be relatively more price sensitive and to perceive relatively higher value for experience services. Since an important factor at work in the minds of buyers is other buyers, the results imply that service providers should frame offers in reference more to others than the self for experiences. The effects of time and distance suggest managers should carefully geo-target offers customized to when and where customers are when buying tickets. As experienced buyers have learned to be price sensitive for tickets, managers should identify these individuals to provide relevant value-added offers.
An Examination of Construal Effects on Price Perceptions in the Advance Selling of Experience Services
Lane T. Wakefield and Kirk L. Wakefield
First Published November 5, 2017
From Journal of Service Research