Price promotions, beneficiary framing, and mental accounting

Abstract

We introduce the idea of beneficiary framing to the promotion response literature. Two large-scale field experiments (total N = 73,010) in the context of print-at-home coupons show that framing a savings message as affecting a beneficiary (i.e., “save for X”) increases coupon printing and redemptions. This beneficiary framing effect is equivalent to an incremental $0.05 (3.4%) of coupon value. We report eight additional studies (total N = 3,052) to investigate the mechanism, replicability, and role of salience. We find evidence supporting a mental accounting explanation: participants with beneficiary-related budget categories rate beneficiary-framed coupons as more account-relevant and more valuable than non-beneficiary-framed coupons.