Beyond reference price: The role of unmet price expectations in consumers' perceptions of value

Abstract

This dissertation posits an entirely new approach for understanding the reference price phenomenon. It is proposed that Festinger's (1957) theory of dissonance reduction provides a practical framework for studying situations in which consumers' encountered prices are significantly different from their expectations. The three modes of dissonance reduction initially proposed by Festinger (to change one's attitude or cognition, to seek consonant information, or to trivialize some element of the dissonant relationship) are experimentally manipulated. These three modes of dissonance reduction are then evaluated for their impact on consumers' perceptions of value and consumers' purchase intentions. A computer-controlled shopping experiment is utilized to test the hypotheses.