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Management article
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Reference no. SMR47202
Published by: MIT Sloan School of Management
Published in: "MIT Sloan Management Review", 2006
Length: 3 pages

Abstract

Consumers are a fickle lot. Case in point: It''s long been known that a consumer will be unhappy if he or she realizes that someone else got a better deal. So marketers tread very carefully when considering a promotion that targets one set of consumers for fear of alienating another. However, according to three researchers, there are times when such a targeted promotion can work to the marketer''s benefit. Under certain conditions, non-targeted consumers are actually attracted to products for which a targeted group is reaping the benefits of a promotion. The authors tested how undergraduate and graduate students reacted to promotions that were not meant for them. Through a series of five scenarios presented to different groups of students, the three researchers determined several conditions under which a targeted promotion made a product attractive to a non-targeted audience. The main conditions are that the targeted audience consists of individuals whom others consider to be experts and that the non-targeted audience is uncertain about a product''s quality. So the average consumer will defer to the expert group to determine which product is higher quality. This also means that a product''s quality has to be more important to the average buyer than is his or her individual taste.

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Abstract

Consumers are a fickle lot. Case in point: It''s long been known that a consumer will be unhappy if he or she realizes that someone else got a better deal. So marketers tread very carefully when considering a promotion that targets one set of consumers for fear of alienating another. However, according to three researchers, there are times when such a targeted promotion can work to the marketer''s benefit. Under certain conditions, non-targeted consumers are actually attracted to products for which a targeted group is reaping the benefits of a promotion. The authors tested how undergraduate and graduate students reacted to promotions that were not meant for them. Through a series of five scenarios presented to different groups of students, the three researchers determined several conditions under which a targeted promotion made a product attractive to a non-targeted audience. The main conditions are that the targeted audience consists of individuals whom others consider to be experts and that the non-targeted audience is uncertain about a product''s quality. So the average consumer will defer to the expert group to determine which product is higher quality. This also means that a product''s quality has to be more important to the average buyer than is his or her individual taste.

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