Enhancing mobile coupon redemption in fast food

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Enhancing mobile coupon redemption in fast food campaigns Sy Banerjee University of Michigan – Flint, Flint, Michigan, USA, and

Scott Yancey Tetherball, LLC, Carmel, Indiana, USA

Enhancing mobile coupon redemption 97 Received August 2009 Revised November 2009, January 2010 Accepted January 2010

Abstract Purpose – The purpose of this paper is to illustrate how managers can strategize different aspects of mobile coupon promotions to enhance their redemption rates. Design/methodology/approach – A secondary dataset of campaign designs and responses were provided by a Midwestern mobile marketing firm. The data were further analyzed using analysis of variance and mean comparisons. Findings – Consumers are more responsive to coupon designs which are congruent with the nature of the product. For utilitarian products, they respond more to “smarter” deals with dollar or percent off, and for hedonic products, they respond more to the timing of receiving the message. Practical implications – Marketers need to better understand local customer demographic profiles to be able to identify their lifestyle – convenient timings, needs, and cravings, so that coupons can be accordingly designed. Originality/value – This paper examines behavioral data in a new (mobile) medium of direct marketing, which allows the authors to capture data across a wider range of physical situations than traditional media, adding more richness and validity to the findings of the paper. Keywords Coupons, Promotional methods, Advertising, Mobile communication system, Fast foods, United States of America Paper type Research paper

Mobile devices are being increasingly used for direct marketing to mass consumer markets. They allow a more personalized as well as “anytime anywhere” mode to advertise to potential customers, mobilizing desktop-based e-commerce and giving an edge to reach on-the-move customers, like in the fast food industry. In this paper, the authors study data of 74 mobile promotion (opt-in) campaigns conducted in Midwest USA for a large fast food chain. The findings reveal that discount size and format interact to explain responses to the promotion of utilitarian food products (entrees and sandwiches), whereas responses to promotions of hedonic (desserts/frozen beverages) are significantly explained by the time of the day when the customer received the ad. 1. Introduction Mobile marketing is gaining popularity among marketing managers worldwide despite the economic recession. Mobile Marketing Association has predicted a 26 percent growth in mobile marketing spends in 2009 to $1.7 billion. A possible reason is the recession itself, which has increased the consumer’s average coupon usage by 72 percent

Journal of Research in Interactive Marketing Vol. 4 No. 2, 2010 pp. 97-110 q Emerald Group Publishing Limited 2040-7122 DOI 10.1108/17505931011051650

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(Prospectiv, 2008), supporting the growth of mobile coupons. One of the industries mobile couponing seems best suited for is the fast food industry. Since fast food chains target people who are on the move or en-route, it is most efficient to reach such customers using a medium that can access them anytime anywhere. If you were a marketing manager of a neighborhood fast food store who wanted to attract customers by delivering electronic coupons to their mobile devices, what aspects of the promotion would you strategize for better response rates? Before moving on to the specifics of the study, it is important for us to identify the contributions made by our research. On a broad level, mobile marketing research is more than just a mere replication of earlier studies in a new media context. Unlike all other forms of traditional media (print, billboard, television (TV), and radio) mobile devices are location and situation pervasive. Since different aspects of situations (locations, time, moods, social environment, and objects) are significant influencers of processing marketing information, validity of findings from traditional media research are relatively “bounded” by the physical contexts in which such media exist. We know that TV advertisements have effects on consumers given that they are located within indoor environments. Would the same effects exist if we had a TV program running while we were driving a car? Or would we pay attention to the same aspects of billboard advertisements if the billboards were installed in our living rooms? Such questions appear meaningless because each type of media is associated with a specific type of physical context. In order to measure the effects of TV ads in multiple physical situations, we would have to make TV available in different types of situations, some of which may not possible. However, when analyzing data on mobile marketing, the data has a much larger range of variability in terms of situations and we can clearly identify which times of the day are better for a certain target audience. Also, we have the opportunity to learn what types of promotional cues have universal appeal (across multiple situations) and which cues are conditionally effective in specific situations. In this paper, we use message timing as a proxy variable for understanding the context or situation the individual is in. Focusing within the field of mobile marketing, prior research has provided limited insight into what factors determine behavioral reactions to mobile marketing campaigns. Some researchers have explored content (Barwise and Strong, 2002) consumer (Dickinger and Kleijnen, 2008; Bauer et al., 2005) and situational characteristics (Banerjee and Dholakia, 2008) that affect the promotions at an adoption level or “intentions” for redemption by consumers. Adoption only implies that a group of customers opt-in to a campaign and agree to receive coupons by text. But what makes them behaviorally redeem these received coupons is still unexplored due to a lack of availability of enough macro firm-level data. Thus, a gap remains in our understanding of what discount sizes, formats and timing help in maximizing “usage” or actual response/redemption rates to mobile coupon campaigns across different product categories, and this research paper contributes in filling that gap. A common notion is to offer higher discount sizes expecting more customer responses. However, prior research has shown that the “dollar worth” is perceived differently depending on the discount format (Diamond, 1992). Also, since mobile devices are a relatively new platform for direct marketing, little is known about what factors affect consumers’ perceptions of promotional content on a device that is a highly personalized and pervasive across all locations and situations. Just as advertising a message in the appropriate physical situation evokes positive feelings and responses

from consumers, advertising at the “wrong time” can lead to strong negative reactions and animosity (Banerjee and Dholakia, 2008). To fill up these gaps in research about determinants of responses to mobile marketing, in this study we examine the effects of discount value (high or low) discount format (freebies or dollar denominations off the price), timing of the advertisement (morning or afternoon) on the rate of response to the offer. We find that the nature of impact of these factors depends on the product category being promoted. For the category meals, entrees, sandwiches, etc. the effect of discount size depends on the format, where higher discount sizes trigger greater response rates if the discount format is dollars off; and higher discount sizes through freebies (buy one get one (BOGO) free) show lower response rates. In the category of desserts and frozen beverages, the pattern is the opposite. Higher discount sizes trigger greater response rates if the discount format is freebies; and higher discount sizes through dollar-offs show lower response rates. Also, timing of the message seems to be most critical. Promotions sent out at noon or before show much better response rates than promotions sent out in the afternoons and evenings. 2. Mobile couponing Some prior research in mobile advertising (Shankar and Hollinger, 2007; Ta¨htinen, 2005) has explored strategic issues like the significance of mobile advertising in the communication mix of corporations (Scharl et al., 2005) and its extent of adoption by multi national corporations (Okazaki, 2005). However, research on specific aspects of campaign execution is still missing. In this section, we outline some distinguishing features of mobile couponing, some primary reasons they are used by companies and describe the couponing process. Distinguishing features of m-couponing Before examining the specific aspects of mobile coupon campaigns, we introduce a few differences between regular (paper) coupons and mobile coupons. Some important differences between ordinary (newspaper) and m-coupons are: . Location specificity. M-coupons can be forwarded to a group of potential customers located within a specific geographical zone. This can be done by identifying customers whose cell phones are getting the signal from a single (or more) mobile tower(s) in a given region. Our study focused on campaigns within two cities in Indiana. . Time-specificity. M-coupons can be forwarded to potential customers according to the relevant time of the day/week. So, bestseller movie rentals can be sent out on weekend evenings, coffee coupons during early weekday mornings, food coupons at lunchtime, etc. In other words, marketers may target daily/weekly times for different activities with relevant product coupons. . Personalization. M-coupons may be personalized to individuals depending on their level of interest in different product categories. Since history of individual responses and transactions can be accessed, companies may target shoe lovers with coupons on shoes, movie lovers with movie coupons, etc. Our dataset contained individuals who had signed up with interest in the fast food category. . Storage. As people carry mobile devices with them all the time, the m-coupons cannot be lost as paper coupons; they can be stored in device memory until redemption.

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Primary uses of m-couponing by companies Companies use mobile coupons in a variety of ways, including: . introducing new products; . spurring bulk purchases to make buyers stock up on the product; . increasing trials, to ensure higher off take of slower moving products; . promoting sell-through to ensure distribution channels are not blocked with excess inventory; and . improving attendance at promotional events for products. Couponing process The couponing process includes delivery, redemption, and clearing. Delivery is how the users receive the coupon. It can be via pull (user generating the request for a coupon) or push (company generated request for participation). The coupon can be sent in SMS, MMS, application, image, or e-mail formats. The coupon can further be redeemed offline using a code, or real time through an interface with a machine containing a scanner. In offline redemptions, the merchants deliver the printed coupons for clearing, whereas in real time redemption the clearing is automatic. For our research, the fast food chain implementing the campaign sets up posters and ads for people (customers) to enroll in the mobile marketing program. Those who enrolled were sent text messages on discounts off specific products and based on their convenience/physical location or appeal for the ad/product; customers visited the nearest stores and redeemed the coupons offline. Clearing was done manually by the merchants. 3. Factors influencing redemption rates One can easily visualize housewives scouring through the Sunday newspapers to collect coupons for their next store visit. Most of us can even remember vivid experiences of being attracted to colorful posters about a new game which would generate points to win a newly launched product. In other words, promotions improve sales of retail products by escalating the perceptions of product value (Alford and Biswas, 2002). These perceptions of value may be driven by both utilitarian and hedonic benefit perceptions (Chandon et al., 2000). Sending text-based promotion coupons at right place and time involves benefits of convenience, savings, entertainment as well as novelty. Of the many possible factors that can affect individuals benefit perceptions and perceived value, here we examine the role of four, i.e. discount size, discount format, message timing, and product category that can further have strong impact on coupon redemption rates. 3.1 Discount size It is known that consumers respond to a new price by comparing it to an internal “reference price” or their expected price of the product (Klein and Oglethorpe, 1987; Monroe, 1973; Thaler, 1985). Multiple theories explain how the level of discount affects consumers’ perceptions of value and utility of the product (Munger and Grewal, 2001). In general, consumer perceptions of value and savings are positively affected by higher discount sizes, leading to increased likelihood of purchase (Alford and Biswas, 2002). All the theories suggest that higher discounts will indicate greater differences with the expected comparison price and will thus escalate perceptions of savings,

value and transaction utility. Thus, discount sizes or levels will definitely positively affect the coupon redemption rates. 3.2 Discount format A BOGO free maybe equated to two for the price of one or a 50 percent discount, but the way in which this discount or freebie is presented makes a difference to consumer’s perception and computation of the products’ value function (Diamond, 1992). Some are presented as percent or dollar denomination off, whereas some are presented in the form of freebies or extra products. Each type of discount or promotional format works better in different situations. Extra product promotions or freebies are preferred because they feel like rewards and seem to increase credibility of the promotion through framing/mental accounting. Percent or dollar offs are preferred when there are specific shopping goals, or when the shopper wants to make “smart” self-attributions (Banerjee, 2009). Such percent/dollar-offs are easy to calculate and integrate within the price of the product. Other research shows that nonmonetary benefits such as freebies are difficult to value and convert into a common unit of measurement (Nunes and Park, 2003) which leads consumers to process such “freebie” offers separately from the price of the concerned product (Chandran and Morwitz, 2006). This leads to make the freebies more salient, which further causes consumers to allocate disproportionately higher weights to such salient information, exerting a stronger influence on judgment (Taylor and Fiske, 1978; Kahneman and Tversky, 1982). Thus, the effect of discount format or framing is expected to have a significant effect on coupon redemptions. 3.3 Message timing Time is socioculturally constructed. In other words, individuals do not respond as much to the clock time (12.00 p.m. or 3.00 p.m.) as much as they do to the tasks those times are associated with (such as time for lunch, work, leisure, etc.). Time perception and use is known to significantly affect consumer processing of advertising information (Mantel and Kellaris, 2003). Time is also an important dimension of context. Mornings to evening of weekdays are considered to be work, whereas weekends are leisure time spent with families. Some of these times are congruent to shopping related tasks, whereas some are not. When advertising messages are received in leisure times or consumption related times, the advertisement seems more relevant (Baker and Lutz, 2000) and individuals direct more motivated attention and comprehension processes to the content of the message (Celsi and Olson, 1988). If text messages of product ads or promotions are received when individuals are busy at work, the same information seems less useful or relevant and more intrusive (Banerjee and Dholakia, 2008). So, it is expected that the timing of the promotion will make a difference to the coupon redemption rates. 3.4 Product category The benefit congruency framework for sales promotion effectiveness (Chandon et al., 2000) predicts that the sales promotions effectiveness is determined by the congruency between its benefits and those of the promoted product. Monetary benefits of a promotion, which are more utilitarian, are more effective on utilitarian products, whereas nonmonetary benefits are more effective on hedonic products. Utilitarian products are primarily instrumental, functional and cognitive; providing customer value by a means to an end, whereas hedonic products are noninstrumental, experiential


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and affective appreciated for their own sake (Hirschman and Holbrook, 1982). So, it can be expected that mobile promotions with monetary vs nonmonetary benefits will vary in redemption rates depending on whether the product category is utilitarian or hedonic. 4. Hypotheses 4.1 Main effects Timing. Time of receiving the advertisement is related to situations people are in, including who they are with and what they are doing. Though mobile phones are a new media for direct marketing, prior research in direct TV advertising (Tellis et al., 2000) has shown that referrals (responses) to TV advertisements vary on an inverted U-shaped curve peaking at midday or noon. So, we expect that ads that have been received at noon or before (morning) will be more effective than ads sent out in the afternoon for both categories of products: H1a. For utilitarian products coupons sent between morning and noon will be redeemed more than coupons sent out in the afternoon and evening. H1b. For hedonic products coupons sent between morning and noon will be redeemed more than coupons sent out in the afternoon and evening. 4.2 Interaction effects Utilitarian product category. According to the benefit congruency framework, since utilitarian products have functional product goals, increasing the discount size of monetary rewards (dollar or percent offs) will lead individuals to perceive a more “efficient/smart” buy leading to higher coupon redemption rates. Conversely, if the discount size of nonmonetary products is increased redemption rates will decrease because the nature of the reward is incongruous with the goals of utilitarian product category. So: H2a. For utilitarian product coupons sent with monetary rewards, higher discount sizes will lead to higher redemption rates. H2b. For utilitarian product coupons sent with nonmonetary rewards, higher discount sizes will lead to similar or lower redemption rates. Hedonic product category. Since hedonic products have experiential, affective, and noninstrumental product goals, increasing the discount size of monetary rewards should reduce coupon redemption rates since they are incongruent with the product goals. So, increasing the discount size of nonmonetary rewards (which are congruent) should increase redemption rates: H3a. For hedonic product coupons sent with monetary rewards, higher discount sizes will lead to similar or lower redemption rates. H3b. For hedonic product coupons sent with nonmonetary rewards, higher discount sizes will lead to higher redemption rates. 5. Method 5.1 Data-collection procedure A secondary dataset was obtained from a Midwestern mobile marketing firm that worked on several promotional campaigns for a major fast food industry client.

To launch the program, in store posters, bag stuffers, and outdoor yard signs were used to bring attention to the program. At the beginning of the program, a company ambassador was present in the fast food chain store to help educate employees and customers of the program. Posters displayed the call-to-action prompting customers to text the KEYWORD into 46237. The first message back told the customers to join the program. Once they texted their consent to receive four to six messages per month, they were in the program and they received “alerts” of coupons letting them know when offers are available. Overall, customers opted “in” to the program so that the company was assured of a threshold level of interest. The data were completely anonymous, as analysis was done of campaign level data. Each cell analyzed represented a campaign and not an individual. 5.2 Independent variables Discount size or offer value. The values of all monetary and nonmonetary rewards were calculated in dollar terms to arrive at offer value. The offer value ranged between $0.75 and $5, the mean was $1.97. Offer values were classified into high and low categories (offer value # 1.49 is low, above 1.49 is high). Discount format or offer framing. A total of 31 differently worded campaigns (such as “$2 off 4 pc chicken basket” and “Buy One Get One FREE Med Arctic Rush”) were coded into “dollar/price off” and “freebies”. There were 30 of the former and 44 of the latter. Message timing. Promotions were forwarded in the mornings as well as afternoons. Timing was coded into “noon and before” and afternoons. Product category type. Product categories were both utilitarian and hedonic. All entrees and meal related products like shrimp basket, double cheeseburgers, chicken salad were coded as utilitarian (instrumental to satisfying hunger) and all frozen desserts like ice creams cakes, Dilly bars were coded as hedonic (cravings). Prior research has shown that consumers tend to underestimate calorie contents of sandwiches and meals (Chandon and Wansink, 2007) thus leading to “health halos” and beliefs about sandwiches/meals being utilitarian and desserts to be a “hedonic” product category (Dhar and Wertenbroch, 2000). 5.3 Dependent variable Redemption or response rate. Number of coupons redeemed was divided by number of people enrolled into the programs and converted into a percentage. Analysis. Two 2 £ 2 £ 2 ANOVAs were conducted using the database (n ¼ 75), one for the utilitarian (n ¼ 36) and one for the hedonic product category (n ¼ 39). Results for the resulting hypotheses are listed below. 6. Results 6.1 Main effects of discount size or offer value For both product categories, meals and desserts, offer value has no significant main effect on the coupon redemption rates (FMeals ¼ 1.008, p , 0.325; FDesserts ¼ 0.784, p , 0.383). Not only is this finding counterintuitive, it has serious implications on managers plans and designs of mobile marketing campaigns.


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6.2 Main effects of discount format or offer framing Framing of the offer as a freebie or cash/percent off does not have a main effect on coupon redemption for either meals (FMeals ¼ 0.063, p , 0.804) or desserts (FDesserts ¼ 0.022, p , 0.882). This implies that framing effects cannot be expected as generally applicable across types of product categories without taking into account discount sizes.

104

6.3 Main effects of message timing For utilitarian products like meals (sandwiches/entrees) timing (Figure 1) has no significant main effect on coupon redemption (FMeals ¼ 1.368, p , 0.252). However, for the desserts category (Figure 2), there is a significant main impact (FDesserts ¼ 7.68, p , 0.01), 10 9.0623 Series 1

9 8 7 6 5 4 3

Figure 1. Effects of message timing on coupon redemption rates of meals

2 0.7667

1 0 Noon and before

After noon

14 Series 1

12.0714 12 10 8 6 3.4192

4

Figure 2. Effects of message timing on coupon redemption rates of desserts

2 0 Noon and before

After noon

where the messages sent at noon and before have significantly higher redemption rates (12.07) than those sent in the afternoon/evening (3.42). 6.4 Interaction effects of offer framing and offer value For the utilitarian product category (meals, sandwiches, and entrees, Table I; Figure 3), there is a significant two-way interaction effect (FMeals ¼ 4.512, p , 0.044). Upon further investigation by classifying offer value into high and low categories (offer value # 1.49 is low, above 1.49 is high), we find that as the value of dollars/percent off is increased, coupon redemption increases from 2.97 to 15.623 percent, but when value of freebies is increased, redemption rates crash from 8.85 to 1.875 percent. This is in line with the theoretical explanation provided by the benefit congruency framework. For the hedonic product category, desserts (Table II; Figure 4), the same offer value £ discount format interaction is not significant (FDesserts ¼ 2.438, p , 0.13), though interestingly, the pattern of means are entirely the opposite of the utilitarian products.

Value low Value high

Freebies

Dollar denominations

8.8538 1.875

2.975 15.6229

Note: Utilitarian products-interaction of discount format and offer value on coupon redemption


Table I.

18 16

Freebies 15.6229

Dollar denom

14 12 10 8.8538 8 6 4

Figure 3. Interaction of discount format and offer value for utilitarian products on coupon redemption

2.975 2

1.875

0 Value low

Value low Value high

Value high

Freebie

Discount

3.375 9.5271

6.38 3.6417

Table II. Interactions of offer value and discount format on coupon redemption for hedonic products

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10

Freebies Discount 9.5271

8

106

6.38 6

4 3.375

Figure 4. Interactions of offer value and discount format on coupon redemption for hedonic products

3.6417

2

0

Value low

Value high

Using the same classification of offer value as for utilitarian products (offer value # 1.49 is low, above 1.49 is high), we find that as the value of the offer is increased from low to high for percent/dollar off, coupon redemption drops from 6.38 to 3.64 percent; but for freebies, redemption increases from 3.37 to 9.5 percent. This contrast between the utilitarian and hedonic categories is supported by the benefit congruency framework (Chandon et al., 2000), though the results do not achieve significance due to a limitation of sample size (Table III). 7. Other findings Response times Another interesting observation we had was that of response times (time taken to physically respond to the message campaign). We looked at response time distributions

Hypotheses

Table III. Summary of hypotheses results

H1a. For utilitarian products, coupons sent between morning and noon will be redeemed more than coupons sent out in the afternoon and evening H1b. For hedonic products, coupons sent between morning and noon will be redeemed more than coupons sent out in the afternoon and evening H2a. For utilitarian product, coupons sent with monetary rewards, higher discount sizes will lead to higher redemption rates H2b. For utilitarian product, coupons sent with nonrewards, higher discount sizes will lead to similar or lower redemption rates H3a. For hedonic product, coupons sent with monetary rewards, higher discount sizes will lead to similar or lower redemption rates H3b. For hedonic product, coupons sent with nonmonetary rewards, higher discount sizes will lead to higher redemption rates

Statistical support

Directional support

No

Yes

Yes

Yes

Yes

Yes

Yes

Yes

No

Yes

No

Yes

of six campaigns (three utilitarian and three hedonic products) and approximately 60 responses. Variations in the response times can be explained by geographical locations of individuals at that time, time of the day (what activities they are engaged in) and how seamlessly those individuals stay connected to their mobile phones or virtual consumption spaces (defined as consumer ubiquity by Banerjee and Dholakia, 2007). Average response time lag to meals was 6.1 hours (38 responses), but those to desserts was 9.3 hours with a total of 27 responses. Though customers took longer to respond to “hedonic” promotions, this delay may have been due to the uneven distribution of campaign timings. One of the dessert campaigns were promoted in the afternoon, whereas all meal campaigns were promoted late morning. This promotion of meals during a “preferred time zone” may be been the cause of early responses. The individual response time records are our gateways to understanding the coupons’ “carryover effects” which are mentioned in the following section. 8. Discussion and future directions Of the different independent variables, the most intriguing effects are of timing. Though for desserts timing seems to have a strong effect on redemption rates, for meals that is not so. A possible cause is the uneven distribution of campaign timing in the meals category. For the dessert (hedonic) category, there are 14 morning and 24 afternoon campaigns, but for meals there are 32 morning and three afternoon campaigns. As a consequence, despite having large differences in the redemption rates, the statistical result of timing for meals is not significant. The absence of main effects for offer framing, offer value, and product category are explained through the benefit congruency framework which indicates that blindly changing the size of the discount or the format will not help increase promotion effectiveness. The framing of the reward has to fit the nature of the product category (monetary for utilitarian and nonmonetary for hedonic). This is further supported by the interaction effect. The interaction effect for hedonic products is absent due to unevenness in the sample; there are few lower offer values and disproportionately high larger offer values. That limitation in our secondary data leads our difference to be statistically insignificant. An interesting direction for future research is the carryover effect (delayed reactions) of such mobile advertising/couponing programs. The carryover effect can be thought of as lagged redemptions, so analysis of response times can give more insight about what type of customers redeem coupons with higher (longer) response times and under what situations/contexts. The other carryover effect is non behavioral; when people view a coupon on their mobile phone, even if they do not respond to it to buy something it can add some goodwill in the company’s name to their mental accounts (in terms of attitude and affect), or just simple brand information (memory). This intangible value of consumers’ memory or goodwill, or both can have other future favorable consequences for the brand being promoted, and future research needs to address ways of measuring this non-behavioral impact. 9. Managerial implications Based on the above findings, following are the two major implications for marketing managers.


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Timing This is one of the most powerful instruments of the mobile coupon promotions, because it is through this medium that marketers can make their campaigns more or less relevant to the customers’ immediate needs. Though the analysis reveals morning messages are more effective than afternoon messages for hedonic products, more research needs to go into demographic profiles of the mobile customer bases. After all, different types of timing may be considered relevant to a nine-to-five administrative worker than a travelling salesman, or to a working mother than a college student. Better time-targeted campaigns can be developed with greater knowledge of stores’ customer demographic profiles. Discount size and format It is important not to blindly throw more and more discounts at the customers expecting better redemption rates and returns. It is essential to keep in mind whether the reward is framed as monetary/nonmonetary, and whether the product category is utilitarian or hedonic. When the product aims to satisfy hunger (an utility), higher levels of monetary price off discounts yield better returns, and increasing nonmonetary rewards (freebies) can generate lower redemption rates. When the product aims to satisfy a craving (hedonic benefits), higher levels of monetary price off discounts yield lower returns, and increasing nonmonetary rewards (freebies) can generate higher redemption rates. While promoting their product lines, it is essential for managers to consciously remember whether they are delivering to hunger or to cravings, and accordingly design coupons. In other words, if a manager wants to promote mobile coupons on a meal, he/she should use “smart deal”-oriented monetary benefits to lure customers and if it is a dessert being promoted, freebies should be used. Though this managerial implication has been drawn from earlier research, our study throws light on the universal applicability of this finding. Though changing situations can lead to changes in the way cues are processed by individuals, this interaction effect of discount size and framing does not change depending on the situation in which the consumer receives the ad, thus it is free of context. So, marketers can apply this finding across any situation or time of the day. References Alford, B.L. and Biswas, A. (2002), “The effects of discount level, price consciousness and sale proneness on consumers’ price perception and behavioral intention”, Journal of Business, Vol. 55 No. 9, pp. 775-83. Baker, W.E. and Lutz, R.J. (2000), “An empirical test of an updated relevance-accessibility model of advertising effectiveness”, Journal of Advertising, Vol. 29 No. 1, pp. 1-14. Banerjee, S. (2009), “Effect of product category on promotional choice: comparative study of discounts and freebies”, Management Research News, Vol. 32 No. 2, pp. 120-31. Banerjee, S. and Dholakia, R.R. (2007), “Are you a mobile shopper? Consumer ubiquity: a multi-dimensional predictor of anywhere, anytime consumption”, Proceedings of American Marketing Association Summer Educators Conference, Washington, DC. Banerjee, S. and Dholakia, R.R. (2008), “Mobile advertising: does location based advertising work?”, International Journal of Mobile Marketing, Vol. 3, December, pp. 68-74. Barwise, P. and Strong, C. (2002), “Permission-based mobile advertising”, Journal of Interactive Marketing, Vol. 16 No. 1, pp. 14-24.

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Taylor, S.E. and Fiske, S.T. (1978), “Salience, attention and attribution: top of the head phenomena”, in Berkowitz, L. (Ed.), Advances in Experimental Social Psychology, Vol. 11, Academic Press, New York, NY, pp. 249-88. Tellis, G.J., Chandy, R.K. and Thaivanich, P. (2000), “Modeling the effects of direct advertising: which ad works, when, where, and how long?”, Journal of Marketing Research, Vol. 37, February, pp. 32-46. Thaler, R. (1985), “Mental accounting and consumer choice”, Marketing Science, Vol. 4 Summer, pp. 199-214. Further reading Helson, H. (1964), Adaptation-level Theory: An Experimental and Systematic Approach to Behavior, Harper & Row, New York, NY. Monroe, K.B. (1990), Pricing: Making Profitable Decisions, 2nd ed., McGraw-Hill, New York, NY. Sherif, C.W. (1963), “Social categorization as a function of latitude of acceptance and series range”, Journal of Abnormal and Social Psychology, Vol. 67, pp. 148-56. Internet source Prospectiv (2008), available at: http://newsblaze.com/story/2008090305303300003.mwir/topstory. html (accessed January 8, 2009).

About the authors Sy Banerjee holds his PhD from the University of Rhode Island, a MBA from International Management Institute, New Delhi and his undergraduate (BSc) in Economics from Presidency College, Calcutta. Prior to academia he had four years of diverse work experience in launching/marketing new products in fast moving consumer goods, telecom and supply chain ventures. His research interests are in technology mediated behavior (internet and m-commerce, mobile advertising) and pricing. Sy Banerjee is the corresponding author and can be contacted at: [email protected] Scott Yancey is a seasoned Marketing Executive and Entrepreneur with over 30 years in multi-media advertising. As a graduate of Indiana University in Marketing and Advertising, he is no stranger to mobile or leading early stage companies. Scott was the founder and president of One2One Mobile after his work as President and Co-Founder of Yancey Marketing.

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