When free gifts hurt the promoted product

Abstract

Purpose The present study aims to demonstrate that providing a free gift upon purchase may induce consumers to devaluate the main product promoted with the offer. The mediating role of persuasion knowledge and the moderating role of consumer shopping orientation are also examined. Design/methodology/approach Three studies with between-subject designs are conducted to test the influence of product–gift fit on evaluations of the promoted product. Findings When a low-fit gift (vs a high-fit gift) is provided as a promotional offer, consumers’ evaluations of the promoted product are undermined. These negative effects are driven by consumers’ activation of persuasion knowledge on the company’s ulterior motive to entice consumers to make a purchase. Such devaluation effects occur especially for consumers with a task-focused shopping orientation, whereas they are mitigated for consumers with an experiential shopping orientation. Research limitations/implications This research extends the conceptualization of product–gift fit and challenges the common claim that free gift promotions maintain the value of the promoted product. By instigating a mechanism underlying consumers’ objections toward low-fit gifts, this research implies that consumers may think of an implicit cost to a free offer based on their knowledge of companies’ tactics. Practical implications Marketers should be aware of the fact that a certain gift may come at a cost for companies and bring about negative inferences regarding the main product. They need not only to select a gift that drives sales but also to be cautious about the gift’s influence on perceptions of the main product. Marketers should ensure that the gift has a good fit with the product while trying to discover a unique gift for consumers. Marketers should also provide an offer that matches shopping orientation of the target consumers. Originality/value This research reveals counterevidence to prior research claiming that free gift promotion does not hurt the perceived value of the promoted product. It enhances a theoretical understanding of devaluation effects and provides useful implications for designing and targeting free gift promotion.