EFFECT OF ATTRIBUTE COMPLEMENTARITY ON CONSUMERS' WILLINGNESS TO PAY FOR BUNDLED PRODUCTS

In a sales context, a common promotional tactic is to supplement a required purchase (i.e., the focal product) by offering a free product (i.e., the supplementary product). We examined the underlying mechanism driving consumers' evaluation of the supplementary product after such a promotion, with 120 undergraduate student participants at a large public university in Taiwan. Results showed that consumers demonstrated higher (lower) willingness to pay for a supplementary product that had higher (lower) levels of attribute complementarity with the focal product. However, this effect occurred only when the price of the focal product was much higher than consumer's internal reference price for the supplementary product. Our findings contribute to the literature on bundled products, reference price theory, and consumers' postpromotion perception of supplementary products' price. Theoretical and managerial implications are discussed.