Article | Journal of Consumer Research | August 2012

Consumer Response to Versioning: How Brands' Production Methods Affect Perceptions of Unfairness

by Andrew Gershoff, Ran Kivetz and Anat Keinan

Abstract

Marketers often extend product lines by offering limited-capability models that are created by removing or degrading features in existing models. This production method, called versioning, has been lauded because of its ability to increase both consumer and firm welfare. According to rational utility models, consumers weigh benefits relative to their costs in evaluating a product. So the production method should not be relevant. Anecdotal evidence suggests otherwise. Six studies show how the production method of versioning may be perceived as unfair and unethical and lead to decreased purchase intentions for the brand. Building on prior work in fairness, the studies show that this effect is driven by violations of norms and the perceived similarity between the inferior, degraded version of a product and the full-featured model offered by the brand.

Keywords: Brands and Branding; Production; Competency and Skills; Welfare or Wellbeing; Cost vs Benefits; Perception; Customers; Performance Evaluation; Fairness; Business Ventures;

Citation:

Gershoff, Andrew, Ran Kivetz, and Anat Keinan. "Consumer Response to Versioning: How Brands' Production Methods Affect Perceptions of Unfairness." Journal of Consumer Research 39, no. 2 (August 2012): 382–398.