This study examines the impact of price transparency—specifically the disclosure of cost breakdown—on brand attitudes and purchase intentions. The findings suggest that pricing transparency generally has a positive effect on attitudes and purchase intentions. However, pricing transparency might backfire, and thus reverse the effect, for luxury products originating from a high equity country (e.g., a fashion brand from Italy), but not for luxury and non-luxury products originating from a low equity country (e.g., a fashion brand from China). Luxury retailers in a high equity country should take extra caution before adopting price transparency

Companies frequently rely on pricing algorithms to automate their price-setting in online markets; thereby, algorithmic dynamic pricing (ADP) has become a common pricing practice in the digital era, with retailers regularly tweaking products’ prices in their online shops. On Amazon.com alone, millions of price changes occur within a day, which corresponds to a price change approximately every ten minutes for each product. Yet, so far, the effects of such pricing algorithms on consumers are unclear. Since ascertaining consumer reactions is essential for retailers’ pricing strategies and retailers need to know how to mitigate negative reactions, our focal research questions are: How do consumers respond to ADP? How can retailers mitigate negative consumer reactions to ADP?

In determining artwork prices, the identification of characteristics of the artist is crucial. While the impact of demographic profiles of artists has been examined in the literature on art pricing, the relationships among artists have been highly disregarded. In the current research, the authors focus on the measures of network centrality derived from group exhibitions in order to investigate their influence on artwork prices. The analysis results suggest that degree centrality and closeness centrality positively affect artwork prices, whereas betweenness centrality has an adverse effect. Moreover, network centrality values play a more important role in explaining artwork prices than historical reputation indexes such as gender, nationality, time elapsed after death, and main residencies of the artists. This study contributes to branding literature, while also providing art marketers with valuable insight into artist branding.

Personalized pricing provides great potential for revenue, but is also accompanied by negative consumer reactions. Therefore, it is of great importance to investigate potential mechanisms and variables that could mitigate these negative effects. In this context, the following paper examines the role of perceived fairness, cognitive dissonance, and product categories.

Barrier options are path-dependent options, and their return depends not only on the price of the underlying asset on the expiry date but also on whether the underlying asset reaches the prescribed barrier level during the contract's validity period. This paper mainly studies the barrier option pricing problem under the Ornstein–Uhlenbeck equa-tion model under an uncertain environment. Assuming that the stock price obeys the Ornstein–Uhlenbeck equation model, the pricing formulas of four European barrier options are derived. Finally, several numerical examples are used to verify the effectiveness of the model.

Price-setting research has mainly focused on normative processes. However, a conception of pricing practices in B2B-companies is missing. Information deficits lead pricing managers to deviate from normative processes. We complement and extent normative models by assessing pricing managers’ compensation behavior in cases of information deficits. We propose a typology of approaches to missing price-related information.

Aftermarket refers to a market in which a company sells complementary goods, replacements of parts, and upgrade or maintenance services to consumers after selling them main durable goods. Intuitively, consumers who purchase main durable goods become major potential customers in subsequent aftermarket. Thus the existence of the aftermarket has a significant impact on pricing of the main durable goods as well as the aftermarket products. In this study, we analyze the effect of aftermarket on the pricing strategy for a company selling both main durable goods and aftermarket products. To do this we first divided the market into markets where the aftermarket products are indispensable and optional. Based on the proposed market types, the profit maximizing solutions are derived using two-period model, and the impacts of consumers’ undervaluation of aftermarket product prices on pricing strategy are analyzed. The results can be summarized as follows : (1) Regardless of the market type, the total profits were found to be inversely proportional to the consumer’s awareness accuracy of product prices in the aftermarket. This is in line with marketing efforts that sales companies have made intuitively to make consumers underestimate the cost of the aftermarket. (2) If aftermarket product is indispensable, only revenue from the aftermarket is sought. On the other hand, if aftermarket product is optional, revenue from the main durable good as well as the aftermarket product will be sought simultaneously. (3) Moreover, when aftermarket product is optional, the lower the awareness accuracy of consumers, the higher the price and profit of the main durable goods, while the lower the price and profit of the aftermarket products. This is contrary to the intuition that the lower the consumer's valuation of the costs of aftermarket, the more advantageous it would be to rely on aftermarket products rather than on main durable goods.

This research examines how inter-price relationships among base and add-on products affect the sales of a new add-on product in the mobile gaming context. Based on theories of price fairness, product familiarity and price-quality relationship, a research model was drawn and tested on a sample of 6,766 weekly observations derived from 74 base games and 514 add-on virtual goods. Our empirical results show that the relative price of a new add-on product, when compared to the base game price, is negatively related to the add-on product sales, but positively related to its sales, when compared to prices of existing add-on products. Furthermore, the inter-price relationships among base and add-on gaming products are moderated by visual richness and game genre. This study provides the implications for IS research and practice.

This works aims to analyze pricing strategies among various luxury sectors as well as to identify latent structures between brands and categories. Unlike previous works, we investigated the firms’ perspective and worth instead of customers’ perceptions. For this purpose, we web scraped market-data from numerous luxury houses such as woman shoes, luxury cars, haute couture and men’s watches (own online shop/ foreign platforms). the results argue for a positive correlation between brand value and prestige pricing. Accordingly, Mercedes-Benz and Louis Vuitton build the most valuable brands in their industries. In Fashion, we found that LV is a feminine brand. Besides, in some categories, a thoughtful competition is coming from lower-scaled companies (premium) which poses real challenges for established high-end manufacturers. A hierarchical cluster analysis shows a significant gender effect in defining luxury categories. Unlike what many would think, men’s luxury items (e.g. shoes and watches) are significantly more expensive than female products.

Climate change is expected to become a considerable threat to life on earth and it already affects certain tourism destinations like mountain regions and costal destinations. For instance, Switzerland is regarded as one of the most popular ski destination worldwide, but today’s ski resorts in Switzerland is facing significant difficulties as weather condition has been particularly harsh for the ski industry in the last years. While ski resorts start to use various rate fences to implement differential pricing, there is relatively little research how their customers perceive these new pricing approaches. Therefore, this study tried to identify how various rate fences adopted in ski resorts, including the use of weather forecasts in differential pricing, are perceived by customers and consequently which of them could be successfully implemented to provide the industry with long-term benefits. In particular, this study focused on the effect of framing and gender on price perception. The study found that female are generally more sensitive to differential pricing and have the tendency to perceive it as less fair.

People face various situations that they have to decide whether to buy or not, before uncertainty is resolved. Under the uncertain conditions, it is most crucial part for consumers that they should consider the expected valuation derived from purchasing tickets or services. Thus, it is important to contemplate buyer uncertainty about future valuation. Xie and Shugan presented the relationship between spot price and advance price in a situation that involves uncertainty. Their findings provide the explicit advance pricing strategies that can create profit improvements (Xie & Shugan, 2001). Their findings lay a foundation of this problem, because buyers are almost always not sure about their future valuations for most services (Xie & Shugan, 2001). In addition to these findings, the researchers found that profits under option pricing strategy outperform those from advance pricing strategy (Preethika Sainam, 2010). They introduce the concept of consumer options and analytically prove that consumer options can make more profits and also can protect consumers from the pitfall derived from unwanted outcomes (Preethika Sainam, 2010). In this paper, we want to consider this problem under more complex and real circumstances. We include one more pricing strategy, discounted advance pricing, which is often called early bird pricing. Furthermore, we divide consumers in two types, risk-neutral consumers and risk-averse consumers. We present a simple analytical model in what conditions each pricing strategies can out-perform others based on consumer types and capacity types.

Recently, Korean companies have become more interested in overseas market, and semi-finished goods have become more and more active. In addition, most of Korean companies are in the form of Complete Knock Down, which is produced in low-wage countries in accordance with glottalization. As a result of the logistics movement between countries, there are many controversies such as tax problems and transfer of added value. Therefore, most companies set Transfer Price with the support of external organizations. In this paper, we propose a practical method for the proper transfer price setting using the cost-plus pricing method.

This papers focuses on remanufacturing processes in a closed loop supply chain. The remanufacturing processes is considered as one of the effective strategies for enterprises’ sustainability. For this reason, a lot of companies have attempted to apply remanufacturing related methods to their manufacturing processes. While many research studies focused on the return rate for remanufacturing parts as a control parameter, the relationship with demand certainties has been studied less comparatively. This paper considers a closed loop supply chain environment with remanufacturing processes, where highly fluctuating demands are embedded. While other research studies capture uncertainties using probability theories, highly fluctuating demands are modeled using a fuzzy logic based ambiguity based modeling framework. The previous studies on the remanufacturing have been limited in solving the actual supply chain management situation and issues by analyzing the various situations and variables constituting the supply chain model in a linear relationship. In order to overcome these limitations, this papers considers that the relationship between price and demand is nonlinear. In order to interpret the relationship between demand and price, a new price elasticity of demand is modeled using a fuzzy based nonlinear function and analyzed. This papers contributes to setup and to provide an effective price strategy reflecting highly demand uncertainties in the closed loop supply chain management with remanufacturing processes. Also, this papers present various procedures and analytical methods for constructing accurate parameter and membership functions that deal with extended uncertainty through fuzzy logic system based modeling rather than existing probability distribution based uncertainty modeling.

This study contributes to the limited literature on the innovative pricing method of Pay-What-You-Want (PWYW) in the context of a high-value service. PWYW is a participative pricing approach that takes away all the power from the seller allowing customers to decide what price they want to pay. As such, the customer is free to set any price (even zero) and the seller has to accept it (Kim et al., 2009). Existing research on PWYW examines the impact on customers fairness perception (Haws et al., 2006), willingness to pay (Spann et al., 2004), and purchase intentions (Chandran et al., 2005). Studies also provide insights into which factors (e.g., price or value consciousness) impact on the PWYW price people pay, and on its profitability (Kim et al., 2009). PWYW is more effective than traditional pricing approaches for services that follow an economy pricing strategy (Schons et al., 2014) but not for luxury goods (Balan, 2014). A notable omission in the literature is the lack of studies that directly compare the profitability of PWYW for potential, new, and repeat customers in a high-value priced service setting. The high-value strategy is defined as positioning a high quality service sold at a medium price (Kotler et al., 2001). Another lack in literature is the use of natural experiments to examine whether groups of customers will pay different prices in comparison to traditional price setting methods. In marketing research, natural experiments have been used to examine price-quality trade-offs with the conclusion that consumers pay more for better quality (Bertini et al., 2012). Using the natural experiment of the biggest dance festival in Europe (ImPlusTanz) where different customer groups pay different prices, the study compares the applicability and profitability of the PWYW pricing method. Specifically, the minimum, maximum, and PWYW prices are compared to traditionally set prices. Results from the secondary data analysis reveal that ImPulsTanz uses a pricing structure based on demographics mainly. Survey results show that the PWYW prices differ between three natural customer groups. Repeat customers are prepared to pay the highest prices compared to new and potential customers. Despite all customers indicating they will pay for the service generally, PWYW prices paid are lower than traditional list prices from the secondary data analysis. Findings also confirm differences between customers with diverse price perception/consciousness, perceived quality and value of the services offered.

This paper investigates how pricing actions of base and multiple add-on products sequentially offered in the marketplace affect their sales with a consideration of the interactive price relationships between base and add-on products and among multiple add-on products, as well as a moderating role of product characteristics.

Pay-What-You-Want (PWYW) is an innovative participative pricing strategy in which consumers determine the price they want to pay for a product or service. Past research mainly focuses on individual variables as antecedents of consumers’ willingness to pay under PWYW pricing and ignores the role of situational factors. We address this gap by investigating the effects of three situational factors, perceived crowding, involvement level and time pressure, on consumers’ PWYW pricing decisions. Pay-what-you-want (PWYW) is an innovative pricing mechanism that gives consumers maximum control over the price setting process, and thus allows buyers to entirely determine the price for their desired product or service (Schmidt, Spann & Zeithammer, 2014). The buyer has the authority to choose any price to pay for the offered product or service and there is no minimum price to protect the seller (Kahsay & Samahita, 2015). Such increased perceived control on the final price induces consumers to greater purchase intentions (Chandran & Morwitz, 2005). Hence, a growing number of firms in different industries such as music, museums, software, and charity sales are using PWYW pricing (Schmidt, Spann & Zeithammer, 2014). Internal reference price (IRP) is defined as a price in the buyers' memories that serves as a basis for judging or comparing actual prices (Monroe, 1973; Monroe, Grewal, & Compeau, 1991). In the context of PWYW involvement has a negative effect on prices paid. Involvement is the level of personal relevance consumers possess regarding a product or a purchase decision (Zaichkowsky, 1985). Involvement is conceptualized as both, an individual difference variable representing an “enduring interest” in a given product (Roy, 2015; Bloch & Richins, 1983). It is also posited that the negative effect of involvement on IRP will be further moderated by perceived crowding. Perceived crowding is often described in negative terms as a confined, constrained, and restricted physical setting; and it has two distinct dimensions, spatial crowding and human crowding (Machleit et al., 2000; Byunn & Mann, 2011). A crowded shopping environment is also incompatible with the consumers’ shopping desires and goals; hence consumers exhibit unfavorable shopping behavior such as spend less time in the store (Machleit et al., 2000; Li, Kim & Lee, 2009). Perceived crowding should therefore negatively influence consumers’ involvement and IRP, thereby affecting the money they are willing to pay in PWYW situation.