Date of Award
Doctor of Philosophy in Business Administration
In a market where consumers are increasingly concerned with maintaining a healthy diet and demand healthier foods, the role of retail grocery stores has been highlighted, as they exert a powerful influence on food choices. To increase more healthful food purchases, some food retailers have implemented marketing efforts to influence consumer food decision-making. However, due to the mixed findings on the effect of existing marketing interventions on improving purchasing of healthier foods, it is unclear which interventions work best to shift purchasing and what benefits they can bring to the retailer.
A promising approach to nudge healthy purchases with behavioral science is to incentivize healthy products according to individual customers’ preferences. Based on customization theory and findings from existing studies on customer choice behavior, we expect this approach to be more effective and bring higher profit to the retailer. On the one hand, customizing offerings to the needs and preferences of a given individual improves marketing effectiveness and cost savings. On the other hand, retailers may also benefit from customization through enhanced customer attitude and loyalty, which serve as key indicators of the long-term success of a marketing program.
The effect of customized incentives is investigated using an existing panel database collected from a generic coupon campaign (Manuscript1) and supplemented by a real-world randomized control trial, in which coupons are designed for health purposes (Manuscript2). Manuscript1 focuses on the effect of targeted coupons on food purchases and demonstrates that while targeted coupons positively influence food purchasing patterns, unhealthy food purchases are more responsive to targeted coupons than healthy food purchases. Manuscript1 leaves some questions unanswered, such as if targeting similarly impacts healthy food categories and whether a customized couponing campaign affects customer attitude and loyalty. Manuscript2 extends manuscript1 by focusing on different groups of consumers and retailer-relevant metrics. Manuscript2 uncovers segment-level differences in coupon response and demonstrates that the difference in response patterns is driven by consumers’ characteristics. Manuscript2 also shows that customized coupon programs will generate several favorable relationship outcomes, including customer attitude, customer satisfaction, and customer loyalty. These findings offer practical implications for retailers who want to implement such a program to support healthy eating.
Guan, Xintong, "CARROT OR STICK: NUDGING CONSUMERS TOWARDS HEALTHIER CHOICES THROUGH CUSTOMIZED PRICE INCENTIVES" (2021). Open Access Dissertations. Paper 1262.
Available for download on Wednesday, November 03, 2021