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The secret to in-store displays: Where to place discounted products relative to regularly priced products to maximize sales

The key question is: Do price promotions on some products differentially impact demand for other products depending on their relative locations within a display? This new study concludes that the answer is yes.

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Researchers from University of Connecticut, Texas A&M University, University of Colorado at Boulder, and University of Florida published a new Journal of Marketing article that examines whether price promotions on some products differentially impact demand for other products depending on their relative locations within a display.

The study, forthcoming in the Journal of Marketing, is titled “The Negative and Positive Consequences of Placing Products Next to Promoted Products” and is authored by Christina Kan, Yan (Lucy) Liu, Donald R. Lichtenstein, and Chris Janiszewski.

Consumers select from a variety of competing products in multi-product displays. Some products are discounted while others in close proximity are regularly priced. For example, Costco offers items that are not regularly stocked at a reduced price to train shoppers to enter the store in search of “deals,” as if on a treasure hunt. Finding these deals exposes customers to proximal products in other categories, which allows Costco to capture sales from people not interested in the discounted product.

The key question is: Do price promotions on some products differentially impact demand for other products depending on their relative locations within a display? This new study concludes that the answer is yes.

The researchers say that “When the proximal items (i.e., those placed nearby) and distal items (i.e., those placed farther) are strong substitutes for the promoted item, we find that a price promotion decreases the sales of proximal products relative to distal products. This is known as a negative proximity effect. However, when the proximal and distal items are weak substitutes for the promoted item, the promoted product increases the sales of proximal products relative to distal products. This is known as a positive proximity effect. In this case, the proximal product benefits from the increased attention by virtue of being close to the promoted product.”

The research team finds evidence for these sales patterns across eight studies. In one study, they analyze yogurt sales at a retail grocer. When non-promoted products are strong substitutes for the promoted product, a 1% decrease in the price of the promoted product results in a .25% decrease in sales of proximal products, but there is no change in sales of distal products. However, when non-promoted products are weak substitutes for the promoted product, a 1% decrease in the price of the promoted product results in a .10% increase in sales of proximal products. Again, there is no change in sales for distal products.

Insights from the Studies

The promotion–proximity results provide three insights.

  • It is often assumed that price promotions draw attention toward the promoted brand and away from all other brands. In contrast, these results show price promotions direct attention to the promoted brand and the brands that surround it (i.e., attention spills over).
  • Prior research assumes that goal-directed consumers will search a product display so that all appropriate products enter a consideration set before the purchase decision is made. In contrast, this analysis indicates that a price promotion can increase (or decrease) the likelihood of a proximal (or distal) product entering the consumers’ consideration set.
  • Prior research assumes multiple purchases come from a single consideration set.  In contrast, this research argues that consumers can search multiple locations in a product display, with each location generating a unique consideration set and purchase opportunity.

Opportunities for Marketing Managers

Understanding how attention spills over to proximal products creates several opportunities for marketing managers.

  1. Managers may consider product subcategory boundaries as opportunities to exploit positive proximity effects. Consider butter cookies and chocolate chip cookies bordering each other on a shelf. Placing a border brand on price promotion should draw increased attention to a less substitutable proximal item and increase the probability of a positive proximity effect.

    Managers can take advantage of this to direct attention to full-priced higher margin brands. Taking this further, positive proximity effects may also occur for non-substitutes (e.g., refrigerated yogurt and refrigerated desserts).
     
  2. Retailers commonly conceive of loss leaders (e.g., milk) as items used to increase exposure to other non-promoted product categories in the store (e.g., product categories they pass on the way to the dairy aisle). However, a loss leader can also be used to introduce customers to new products within a product category. For example, imagine discounting a product like almond milk and surrounding it with novel flavors/versions of non-promoted items (e.g., oat milk, soy milk) to induce trial of those new items. In this sense, price promotions benefit the promoted brand and also increase exposure to other high margin items in the product category.
     
  3. Some products, such as wines on a shelf, are organized by price levels. For categories in which substitutability is defined by price, placing any item on sale would have a negative influence on proximal items. Because consumers have little expectation of which cabernets should be located next to each other, managers may place lower margin items proximal to price-promoted items during the promotion.

Strategies

Online marketers, take note: Online viewers prefer livestreams to recordings

Watching an online performance in real time boosts several aspects of the viewing experience.

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In an era when most TikTok videos are prerecorded, can a band with a new single create a tighter bond with fans by debuting via livestream instead? Can a business do the same when promoting a new product?

New research from the McCombs School of Business at The University of Texas at Austin suggests they could.

Since the pandemic, the livestreaming industry has been booming. The global market is expected to reach $345 billion by 2030, up from $100 billion in 2024. Nearly 30% of internet users watch livestreams at least once a week on social media.

Adrian Ward, associate professor of marketing, is one of them. A few years ago, he was viewing a livestream of a town hall meeting and found himself gripped by a speaker’s comments, feeling as if he were actually in the room. On reflection, he suspected it was the liveness of the event, as much as the speaker, that kept him glued to the screen.

“As we spend more of our time online and on social media, it’s worth asking how we can feel as complete and connected as possible in these spaces,” Ward says.

Live and Let Stream

With Alixandra Barasch of the University of Colorado Boulder and Nofar Duani of the University of Southern California, Ward began to investigate what he calls the “mere liveness effect”: the idea that simply knowing an event is streaming in real time makes a viewer feel more connected to the performer.

The researchers ran five experiments with 3,500 total participants. By manipulating various factors, they compared how, when, and why viewers reacted to watching livestreams versus prerecorded videos online.

In one experiment, participants watched live or recorded videos of their choosing on the platform Twitch. In another, they viewed a performance by the R&B cover band Sunny and the Black Pack, either live on YouTube Live or its recording the next day on YouTube.

In a third, the researchers created their own streaming platform to show participants identical videos, manipulating whether the content appeared to be live or prerecorded.

The experiments provide evidence that watching an online performance in real time boosts several aspects of the viewing experience:

  • Connection. Viewers in one experiment felt 7 percentage points more connected to the performers in the live video. Another experiment showed the effect was even stronger when viewers believed no one else was watching.
  • Enjoyment. In another experiment, viewers enjoyed the live video 5 percentage points more than the prerecorded one.
  • Engagement. Real-time streams carried a “liveness lift.” Viewers chose to continue watching longer, and they were more willing to follow and subscribe to the live streamer’s channels.

A common factor underlying those effects was a heightened sense of presence, Ward says. “When we watch something live, we are psychologically transported there.

“It’s not that there’s actually something different about the video itself. It’s that we know that it’s live right now, and that breaks down barriers between our world and the world on the other side of the screen.”

Lessons for Liveness

One quality weakened the liveness effect: not being able to see a performer’s face. When viewers saw only a musician’s hands, they felt less connected, even though they were watching the same performance.

The findings have implications for marketers, platform developers, and content creators, Ward says. In an age when people increasingly meet their social needs online, going live can benefit streamers by motivating audience engagement.

As a follow-up, he’s working with a graduate student to study whether the liveness effect translates into greater brand trust or sales.

“From influencers to businesses, it’s about the experience of real people seeing other real people live and in the moment,” Ward says. “It makes you feel like you’re sharing something.”

The Liveness Lift: Viewing Live Streams Creates Connection and Enhances Engagement in Amateur Music Performances” is published in The Journal of Marketing.

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Strategies

Renting out your place? Human connection key to a successful holiday rental

Warmth, friendliness and a sense of belonging, or the “homely” side of the experience, strengthen guest loyalty, making them more likely to return to the same host. However, these feelings alone didn’t necessarily make guests more likely to recommend the property to others.

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Striking up a connection with the property host is the factor that drives repeat bookings on holiday accommodation platforms such as Airbnb.

This is according to a new study, carried out by universities in the UK and Iran and published in the February 2026 edition of International Journal of Hospitality Management, that suggested that quality and value of accommodation also play a part in guest satisfaction, but personal connection is key to people deciding to stay again.

The research analyzed hundreds of online guest reviews and conducted in-depth interviews to understand what shapes guests’ evaluations of their stays in what is known as “peer-to-peer accommodation”.

Conducted over six years, the study shows that guests assess their stays using emotional cues such as warmth, atmosphere, and aesthetics; and cognitive cues such as cleanliness, safety, and convenience.

The study found that warmth, friendliness and a sense of belonging, or the “homely” side of the experience, strengthen guest loyalty, making them more likely to return to the same host. However, these feelings alone didn’t necessarily make guests more likely to recommend the property to others.

In contrast, affective and intellectual experiences – the enjoyment and perceived value of the stay – were stronger predictors of recommendations and positive reviews.

The research also examined how the quality of booking websites, such as Airbnb’s platform, influences guest behaviour. Although the website didn’t change how guests felt about the property itself, a well-designed and trustworthy site directly boosted guest loyalty and word-of-mouth.

Co-author Nektarios Tzempelikos, Professor of Marketing at Anglia Ruskin University (ARU), said: “Guests think carefully about both emotional and practical aspects before booking. Hosts who focus only on one side – either charm or functionality – may be missing the bigger picture.

“Platforms like Airbnb thrive when they’re designed for trust. Guests return to sites that are clear, reliable and easy to use. But it’s not just about tech, it’s about people. The most memorable stays come from warmth, authenticity and genuine local connection.

“By encouraging friendly, personal communication between hosts and guests, and balancing smart technology with a human touch, platforms can create experiences that feel less transactional and more meaningful.”

The study was carried out by researchers from Brunel University, University of Bradford, Newcastle University, Anglia Ruskin University and the University of Tehran.

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BizNews

Wine sellers, pay attention: Women more likely to choose wine from female winemakers

Messages like “proudly made by a woman winemaker” increased women’s intentions of purchasing wines, particularly when the label’s artwork reinforced the point with feminine gender cues such as flowers. Women were also willing to pay higher prices for those wines.

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Promoting women’s ownership in wineries can boost sales among the largest group of wine consumers, who happen to be women.

Messages like “proudly made by a woman winemaker” increased women’s intentions of purchasing wines, particularly when the label’s artwork reinforced the point with feminine gender cues such as flowers. Women were also willing to pay higher prices for those wines, according to the research from Washington State University and Auburn University.

The findings are noteworthy because 59% of all wine purchases in the US are made by women, said Christina Chi, coauthor of the research and professor of hospitality business management at WSU’s Carson College of Business.

Wine is often considered a cultural product, where the winemaker’s identity plays a role in shaping the brand’s image, she said.

Women winemakers, however, are less likely than their male counterparts to include their names on bottle labels or draw attention to their gender. Their reluctance may stem from concerns about prejudice toward their products in the male-dominated wine industry, Chi said.

“Our findings suggest that women winemakers and winery owners can benefit by being more visible,” she said. “The research shows that they can disclose their ownership with confidence and leverage it as a marketing strategy.”

The possibilities include putting “women-made wine” statements on labels or packaging, and retail store displays featuring women-made wines.

Demi Deng, an assistant professor at Auburn who earned her doctorate at WSU, is the first author on the research published in International Journal of Hospitality Management. Ruiying Cai, an assistant professor of hospitality business management at WSU, also contributed.

The new findings build on earlier studies showing that women are more inclined to buy wine with feminine gender cues on the labels. The 2024 research – by Cai, Chi, Deng, and WSU Emeritus Professor Robert Harrington – received widespread publicity. Beverage trade journals carried the story, and women winemakers were enthusiastic about the findings.

“As researchers, we want our work not only to have societal impact, but to have practical significance for the wine industry,” Chi said. “From the response, we saw that women winemakers were following our research and were eager for additional studies about women wine consumers.”

More than 1,000 US women participated in the most recent research, which involved a three-part study.

First, the researchers replicated the 2024 findings about feminine cues on wine labels. Using a fictitious Columbia Valley red table wine, the women surveyed expressed higher intentions of purchasing the wine when the label’s artwork featured a bouquet of flowers versus a masculine portrait. They were also willing to pay $3.50 more per bottle – about $17.75 for wines with feminine labels compared to $14.25 for wines with masculine cues.

In the second phase of the study, a “woman-made wine” statement was added to marketing materials. Women consumers had even stronger purchase intentions for wines with both the statement and feminine artwork on labels, the research found.

In the final phase, photos of women winemakers were further added to the marketing materials. But women were less likely to buy feminine-label wines when the female winemakers were pictured. Rather than focusing on the “woman-made” messaging, consumers’ decisions may have been swayed by whether they related to the individual women portrayed in the photographs, researchers said.

The studies also tested the marketing strategies on wines with masculine labels. Adding a “woman-made” statement significantly increased their appeal to women consumers. And when female winemakers were pictured in the marketing materials, women were willing to pay $3 more per bottle for wines with masculine labels.  

Besides helping women winemakers market their products, Deng said she hopes the research will draw attention to women’s contributions to the industry. In the United States, about 18% of winemakers are women.  

Deng worked as a sommelier in New Zealand before she earned her doctorate. “I actually encountered a lot of women winemakers, but their names aren’t visible in the wine market,” she said.

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