Bummer! You meant to get to the mall to buy that discounted leather jacket, but missed the sale. A new study in the Journal of Consumer Research uncovers a strategy for releasing consumers from "regret lock," which results in not making any purchase because the item they want is no longer deeply discounted.
Author Michael Tsiros (University of Miami) says retailers need to think about the composition of a second sale if they still want customers who missed the first one to make a purchase. "If the second sale is on a different product or also includes a different product that was not available during the first larger sale, the new alternative will act as a regret releasing mechanism," the author explains.
"The attractiveness of the new alternative will increase and lead to higher likelihood to purchase and an increased market share for the alternative that was added to the choice set," he continues.
In three laboratory studies and one field study, Tsiros tested participants' levels of "anticipated regret" after they were told about sales they had missed. For example, subjects were told that a $500 leather jacket they wanted would be on sale for $350, but they missed the sale. The researcher tested several alternative sales of both that jacket and similar items to determine what kinds of items and discounts helped people overcome their regret about missing the big sale.
Tsiros also determined that missing a big sale on an item leads people to think more negatively about the object; participants commented that a sofa they had missed a sale on was less attractive and trendy--and less-suited to their décor--than one that was still on sale; the two sofas were objectively similar.
"Several managerial implications are discussed, such as managers timing sales of different brands to ensure that they find another sale on a different, yet similar product," writes Tsiros. "Alternatively, managers could highlight unique features of different products or highlight attributes that are more subjective or that relate to the fit between the customer and the product. This approach enables consumers to perceive the two sales as less comparable and frees them from anticipated regret."
Michael Tsiros. "Releasing the Regret Lock: Consumer Response to New Alternatives After a Sale." Journal of Consumer Research: April 2009.