The Psychology of Discounts Behavioral Pricing Strategies in Online Retail

This study examines the psychological factors influencing consumer responses to discount strategies in online retail. Using primary data from 300 respondents, it analyses the impact of discount size, perceived savings, urgency feeling, and trust on purchase intention and impulse buying. Statistical techniques, including correlation, multiple regression, ANOVA, and Structural Equation Modelling (SEM), were employed. The results reveal that perceived savings and urgency feeling significantly influence purchase intention, whereas discount size has no direct effect. Instead, discount size indirectly affects consumer behaviour by enhancing perceived value and creating urgency. Urgency also plays a key role in driving impulse buying. Furthermore, no significant differences were observed across discount types, indicating that consumers respond similarly to various formats. The study highlights the importance of psychological perceptions over actual price reductions and suggests that effective pricing strategies should focus on value framing and urgency creation to influence consumer decision-making.