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Heterogeneity in Preferences for Odd Prices

  • Bernhard Baumgartner
  • Winfried J. Steiner
Part of the Studies in Classification, Data Analysis, and Knowledge Organization book series (STUDIES CLASS)

Abstract

The topic of odd pricing has attracted many researchers in marketing. Most empirical applications in this field have been conducted on the aggregate level, thereby assuming homogeneity in consumer response to odd pricing. This paper provides the first empirical study to measure odd pricing effects at the individual consumer level. We use a Hierarchical Bayes mixture of normals model to estimate individual part-worths in a conjoint experiment, and demonstrate that preferences of consumers for odd and even prices can be very heterogeneous. Methodologically, our study offers new insights concerning the selection of the appropriate number of components in a continuous mixture model.

Keywords

Price Level Conjoint Analysis Bisectoral Line Price Threshold Price Perception 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer-Verlag Berlin Heidelberg 2007

Authors and Affiliations

  • Bernhard Baumgartner
    • 1
  • Winfried J. Steiner
    • 1
  1. 1.Department of MarketingUniversity of RegensburgRegensburgGermany

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