Effects of Expiration Date-Based Pricing on Brand Image Perceptions

Expiration date-based pricing (EDBP) occurs when a grocery retailer reduces the price of a perishable product according to its remaining shelf life. While, conventional wisdom suggests that this practice leads to negative consumer evaluations of brand quality, a series of field experiments reveal negative effects on brand quality perceptions only among loyal consumers and those who perceive low risk associated with perishables. The effect is also mediated by consumer distrust (Study 1). In addition, EDBP has no effect on brand quality image if consumers are already familiar with this pricing practice (Study 2), and it may even generate positive consumer evaluations when framed as a cause-related marketing activity to reduce waste (Study 3). Additional evidence indicates that psychological contract violation perceptions provide the underlying mechanism for explaining consumer responses to EDBP (Study 4). This article ends with an agenda for further research and implications for retail practice.

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► Expiration date-based pricing (EDBP) occurs when discounting perishables based on shelf life.
► EDBP has different effects on brand quality image under different conditions.
► EDBP has negative effects if consumers perceive low risk and for loyal consumers.
► EDBP has insignificant effects if consumers are highly familiar with this practice.
► EDBP may have positive effects if it is communicated as a green marketing practice.