Role of Charm Pricing in Purchase Decision - A Study of Online Consumers of Pakistan

Abstract

This research aims to explore the role of charm pricing in purchase decision of online customers of Pakistan. After extensive literature review, a gap is found to explore specifically the role of “charm pricing strategy” in the purchase decision of customers with emerging online shopping context. This study is potentially beneficial for marketers and advertisers of those companies doing online business in Pakistan to enhance their sales through relevant pricing mix. Based on constructivist philosophy, this study has taken qualitative approach and exploratory strategy is used. Non-numeric qualitative data is collected through semi-structured interview from the online consumers. Purposive sampling technique is used, as we have selected the participants who are actively involved in online shopping. There were total 14 interviews conducted and 13th interview manifested the saturation point, the 14th was conducted to validate it. Interview protocol was designed with semi-structured design. Consent forms were also prepared which were filled by the participants. Axial codes were prepared from the transcripts and field notes. Thematic analysis was performed on the codes and results were extracted. Result suggests that, in the online shopping setting, urban customers tend to perceive charm pricing as marketing tool by companies to lure customers, and therefore they usually do not take this into their considering while making purchase decisions. Customers with rural background, however, tend to perceive charm pricing as discount and it usually lures them to explore those products further on websites and make purchase decision. Researches on the same domain, albeit with quantitative approach, on the impact of different pricing strategies and discounts on consumers have been conducted internationally, however, no qualitative research is yet undertaken on specifically the role of charm pricing on online customer’s purchase decisions in the local context.