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Pay-what-you-want for high-value priced services: Differences between potential, new, and repeat customers

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  • Stangl, Brigitte
  • Kastner, Margit
  • Prayag, Girish
Abstract
This study contributes to the limited literature on the pricing method of pay-what-you-want (PWYW) in the context of a high-value service. The study evaluates the applicability and profitability of PWYW by comparing the minimum, maximum, and PWYW prices to traditional list prices of Europe's biggest dance festival (ImPulsTanz). Results from an analysis of secondary data from ImPulsTanz reveal a pricing structure mainly demographic-based. Survey results show that PWYW prices differ between three customer groups (potential, new, and repeat). Comparing potential, new, and repeat customers, the latter is willing to pay the highest prices. Despite all customers indicating their willingness to pay for the service, PWYW prices are lower than traditional list prices. Findings also confirm the existence of three segments of customers with diverse price consciousness and quality, and value perceptions. Implications for the pricing and promotion of high-value services using PWYW are offered.

Suggested Citation

  • Stangl, Brigitte & Kastner, Margit & Prayag, Girish, 2017. "Pay-what-you-want for high-value priced services: Differences between potential, new, and repeat customers," Journal of Business Research, Elsevier, vol. 74(C), pages 168-174.
    • Handle: RePEc:eee:jbrese:v:74:y:2017:i:c:p:168-174
    DOI: 10.1016/j.jbusres.2016.10.030
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    References listed on IDEAS

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    2. Mihai ȚICHINDELEAN & Claudia OGREAN & Mihaela HERCIU, 2024. "Do Loyal Customers Buy Differently? Examining Customers’ Loyalty In A Self-Service Setting," Studies in Business and Economics, Lucian Blaga University of Sibiu, Faculty of Economic Sciences, vol. 19(1), pages 350-367, April.
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    9. Rathore, Himanshu & Jakhar, Suresh Kumar & Kumar, Satish & Kumar, Madhumitha Ezhil, 2022. "Pay-what-you-want versus pick-your price: The interplay between participative pricing strategies and consumer's need for cognition," Journal of Business Research, Elsevier, vol. 141(C), pages 73-84.
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    11. Weisstein, Fei L. & Choi, Pilsik & Andersen, Peter, 2019. "The role of external reference price in pay-what-you-want pricing: An empirical investigation across product types," Journal of Retailing and Consumer Services, Elsevier, vol. 50(C), pages 170-178.

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