Personalized price promotion (PPP) is a marketing instrument that addresses the limitations of untargeted promotions by tailoring the offers to individual customers based on their purchase histories. Current evidence on PPP is limited to its immediate effects on buying behaviors at grocery stores and food companies' economic benefits. Moreover, little is known about the role of consumer characteristics in determining how effectively this promotional tool works. Hence, we aim to assess the effectiveness of PPP in promoting healthy fast food and which consumer-specific factors affect its performance.
The authors conduct a laboratory experiment to examine the effects of personalized and non-personalized coupons for lower-calorie fast food menus on food and calorie selection. The coupon personalization is based on participants' menu choices, calorie needs and deal proneness. The authors additionally investigate how post-intervention changes are influenced by consumers' estimation of their selected calories, and their attitudes toward nutrition.
Recipients of personalized incentives are more likely than participants in the control group to redeem the offered coupons, select more healthy items and reduce their selected calories. Such changes are less likely among participants underestimating the calorie content of their menu choices and perceiving higher barriers to healthy eating. Personalized coupons perform better even among subjects receiving lower discounting levels than the control treatment.
As the first to evaluate the effectiveness of PPP in encouraging healthy food choices, this study highlights the potential of this cutting-edge price intervention and provides valuable implications for future research.
