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Abstract
Over the past four decades, annual one-day sales promotions have become engrained in the DNA of retail sales strategies. Black Friday has evolved into the premiere one-day sales event and the official start of the holiday shopping season. Other one-day sales promotions have also penetrated the retail industry ranging from the Monday after the Thanksgiving holiday weekend known as Cyber Monday, Amazon’s Prime Day, Green Monday, Small Business Saturday, etc.
Despite the years of strong sales and consumer turnout, the retail sector has been heavily impacted by the Covid-19 pandemic as well as disrupted supply chain networks. Retailers have shifted the sales event from the traditional in-person one-day event to extended sales promotions. The study examined “extended” annual-sales promotions from the perspective of consumers analyzing perceived sales promotion benefits, the effects of the time pressure and its role on consumers value perceptions and their overall loyalty. Results indicate that both perceived sales promotion benefits and perceived time pressure had significant impacts on consumers’ perception of value. Although extended vii annual sales events increase the duration of sales promotion, consumers still perceive high levels of time pressure. Despite the increased length of the promotional events, retailers still engage in time-limited promotions, resulting in decreased levels of consumer value perception. Results also indicated a moderating effect that shows as perceived time pressure increases, it strengthens the relationship between perceptions of value and customer loyalty. As predicted, consumer perception of value had a significant effect on customer loyalty. High levels of perceived value result in increased levels of customer loyalty as shoppers are less likely to incur the risk of switching costs, information search and the inconvenience of changing retailers.
The study’s implications are imperative to today’s retail environment and the ever-increasing struggle of providing consumer value whilst increasing customer retention. In addition to focusing on the monetary benefits of extended annual sales promotion, firms should also prioritize the hedonic benefits of participating in them as well. Additionally, retailers should also reexamine the use of time-limited promotions, as it increases search costs and information processing whilst simultaneously reducing convenience and the ability to browse.