The effects of presentation formats and consumer cognitive styles on consumer’s discount preferences

Purpose This study aims to explore the underlying mechanism and boundary conditions of consumer’s preference on a multiple-percentage discount over an economically equivalent single discount. Design/methodology/approach The authors tested their predictions using two large-scale online experiments accompanied by a fully controlled laboratory experiment. Findings This study shows that the preference for a multiple-percentage discounts over an economically equivalent single-percentage discount is because consumers directly add the raw values of multiple-percentage discounts. The preference is less prominent if the percentage discounts are presented using round (vs non-round) numbers and is strengthened by experiential-thinking style. Research limitations/implications This study examined consumer preferences between a single-percentage discount and an economic equivalent multiple-percentage discount. A promising research topic is exploring consumer preferences between multiple-percentage discounts. Practical implications Understanding how different presentation formats of the same price discount can lead to different evaluations enables managers and marketers to ensure a more effective promotional strategy. Originality/value This study extends literature on price-based promotions by demonstrating how consumers’ preferences for multiple discounts can be strengthened or weakened.