The Influence of Prior Beliefs, Frequency Cues, and Magnitude Cues on Consumers' Perceptions of Comparative Price Data

Abstract

A widespread practice in grocery store advertising is to compare the advertised store's prices to a competitor's prices on multiple items. An important, but largely unexplored, issue is how this information is processed and used in conjunction with prior beliefs to influence price perceptions. In our initial studies we manipulated prior beliefs and two data-based cues—frequency of price advantage and magnitude of price advantage—to determine their relative influence on consumer price perceptions. Results indicate that prior beliefs affected price perceptions but that the frequency cue exerted a dominating influence. Several follow-up studies demonstrate the robustness of this phenomenon across a variety of presentational and instructional conditions.