Checkbox coupons – Are they more or less effective than temporary price reductions?
(A2026-133724)

AUTHORS

Jan Heinemann, University of Hamburg; KAREN GEDENK, University of Hamburg

ABSTRACT

Traditionally, online retailers offer many temporary price reductions (TPR), but recently, some have started using a new type of price promotion instead: Checkbox coupons. Like TPR, checkbox coupons are offered directly on the website that shows the promoted product, and consumers can redeem the coupon by simply ticking a checkbox. It is not obvious whether checkbox coupons are more or less effective than TPR. We for the first time compare these two types of price promotions, and study promotion framing as a moderator. In an incentive-compatible experiment with a fictitious web shop, we find that compared to a typical TPR (which advertises savings in monetary terms or in %), checkbox coupons increase brand choice probability less. This is due to higher price confusion and lower perceived savings. Also, checkbox coupons do not offer much more potential for price discrimination than TPR – 93 % of consumers who buy the promoted product, also redeem the coupon.