Eastern versus Western Culture Pricing Strategy: Superstition, Lucky Numbers, and Localization

Abstract

Eastern versus Western culture pricing practices differ with respect to price endings; however, Eastern cultures are increasingly influenced by Western multinational corporations. At the same time, increasing antiglobalization sentiment suggests the use of localization strategies in these markets. The authors investigate whether pricing practices still differ in this new environment, examine the role of superstition, and ask whether Western brands can benefit from localizing pricing practices. They explore the use of lucky number price endings and consumer responses to such pricing strategies in Singapore, an Eastern culture that is strongly exposed to Western multinational influence. Using a content analysis of newspaper advertisements and two experiments, the authors find that superstitious pricing practices continue, especially with high-priced items and brands of Eastern (vs. Western) origin. In the experimental studies, they find that superstitious pricing has a positive effect on price attractiveness and that foreign brands that localize their prices benefit from a more positive brand attitude.