A New Look at Consumer Responses to Certain and Uncertain Rewards
Graduation Year
2024
Document Type
Dissertation
Degree
Ph.D.
Degree Name
Doctor of Philosophy (Ph.D.)
Degree Granting Department
Marketing
Major Professor
Kelly Cowart, Ph.D.
Co-Major Professor
James Stock, Ph.D.
Committee Member
Jeannette A. Mena, Ph.D.
Committee Member
Nathaniel Hartmann, Ph.D.
Committee Member
Dezhi Yin, Ph.D.
Keywords
Decision Making under Uncertainty, Lottery Promotion, Moral Judgment, Self-serving Motive, Uncertain Rewards
Abstract
Both certain rewards, which refer to incentives associated with a 100% probability of receipt, and uncertain rewards, which refer to incentives associated with probabilities of receipt that are less than 100%, are widely employed in marketing. Expected utility theory and prospect theory support the superiority of certain rewards over uncertain rewards. This research aims to investigate whether consumer aversion to uncertain rewards depends on the presence of consumer inference about firm immorality, which refers to the consumers’ belief that the firm could be engaging in unethical practices in promotions. Study 1 identifies two psychological mechanisms that explain why uncertain rewards are inferior to certain rewards in marketing: consumers’ inferences about a firm’s self-serving motives and consumers’ inferences about a firm’s immorality. Studies 2, 3, and 4 identify three boundary conditions under which consumers are not averse to uncertain rewards. Study 2 finds that consumer aversion to uncertain rewards decreases when there is a third-party regulator overseeing the promotion. Study 3 documents that consumer aversion to uncertain rewards decreases when the firm is highly familiar to consumers. Lastly, Study 4 demonstrates that uncertain rewards consisting of similar monetary values (e.g., a 1/3 chance of winning a $20 hand cream, a 1/3 chance of winning a $20 shampoo, and a 1/3 chance of winning a $20 bodywash) can outperform both certain rewards (e.g., a 100% chance of winning a $20 hand cream) and uncertain rewards comprised of different monetary values (e.g., a 1/3 chance of winning a $60 hand cream, a 2/3 chance of winning $0).
Scholar Commons Citation
Ding, Aihui, "A New Look at Consumer Responses to Certain and Uncertain Rewards" (2024). USF Tampa Graduate Theses and Dissertations.
https://digitalcommons.usf.edu/etd/11118
