Title

Hospitality Managers' Price-Ending Beliefs: A Survey and Applications

Authors

Authors

R. M. Schindler; H. G. Parsa;S. Naipaul

Comments

Authors: contact us about adding a copy of your work at STARS@ucf.edu

Abbreviated Journal Title

Cornell Hosp. Q.

Keywords

99-cent pricing; managers' beliefs; price endings; just-below pricing; restaurants; ADVERTISED PRICES; 9-ENDING PRICES; STRATEGIES; CHOICE; SIGNAL; SALES; MODEL; ODD; Hospitality, Leisure, Sport & Tourism; Management; Sociology

Abstract

The use of "just-below" pricing (such as pricing an item at $6.99 or $6.95, rather than $7.00) has been common in some segments of the hospitality industry (such as quick-service and mid-scale dining). The results of a detailed survey of the price-ending beliefs of hospitality managers show that many believe that just-below prices connote good value and round-number prices connote high quality. Furthermore, the majority of these managers believe that consumers tend to drop off or otherwise give insufficient consideration to a price's rightmost digits. Although one might expect this drop-off belief among those managers who use just-below price endings, it is found also in a majority of those managers who do not use just-below price endings. The survey results suggest that managers who decline the benefits of a consumer drop-off tendency do so because they also believe in one or more possible negative consequences of using just-below price endings. These include the beliefs that just-below endings (1) impair perceptions of high quality, (2) work against an upscale image, (3) give an impression of not being fully honest or straightforward, and (4) involve inconvenience in calculating or communicating the price or in making change.

Journal Title

Cornell Hospitality Quarterly

Volume

52

Issue/Number

4

Publication Date

1-1-2011

Document Type

Article

Language

English

First Page

421

Last Page

428

WOS Identifier

WOS:000295916700009

ISSN

1938-9655

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