Short-Term Discounting Frameworks: Insights from Multiple Experiments

Abstract

Ever since the online retailing format has emerged in India, consumers now have wider options available for them to buy a product at a discounted price and notably, as online stores in India are following the product discounting as one of the key drivers for consumer acquisition, consumers’ perspective towards discount at brick-and-mortar store has changed. This change in consumers’ perspective has put the majority of brick-and-mortar retailers in India into a quandary and they are losing out their market share slowly to online retailers. In this research which is based on recommendations of empirical research previously carried out on the impact of changes in retailer and consumer perspective towards discount post emergence of online stores in India, we have carried out multiple experiments on multiple short-term discounting frameworks to investigate and recommend brick-and-mortar retailers on ideal (a) frameworks, (b) duration, (c) types, (d) assortment coverage, and (e) advertising techniques for short-term discounting strategies to enable brick-and-mortar retailers to design appropriate sales promotions to gain a competitive advantage over online retailing on the discount component.