Perceived control and behavioral intents: unravelling their influence on willingness to pay, purchase intentions and prices paid across genders under a PWYW setting.

Abstract

An emerging participative pricing mechanism known as Pay-what-you-want pricing strategy has been found to be very effective in creating a hype amongst customers and earning high marginal profits. Many studies have been conducted in the past to find out the different factors which affect the success of PWYW pricing strategy. The provision of an external reference price or an anchor price has been studied, but in most cases when a higher ERP is provided it triggers back and results in less profitable outcomes. Our study has concluded that higher ERP must be provided in a such a way that the perceived behavioral control of the participants is not disturbed, as perceived behavioral control highly affects the behavioral intents of the participants such as purchase intention. Business can also simply target individuals with higher perceived behavioral control and provide a higher ERP and can increase purchase intention. Therefore, it was found that perceived control mediates the effects of ERP on purchase intentions. The prices participants are willing to pay are highly affected by gender. It was found that the price estimates of females as compared to males were significantly greater. Hence, the successful provision of a higher ERP depends on the perceived control of the participants in generating more purchase intention and the gender that will be willing to pay more under a pay what you want setting are females.