Digital redemption of coupons: satisfying and dissatisfying effects of promotion codes

Coupons, in the form of “promotion codes”, are now a mainstay of the online shopping experience, but online coupon redemption differs substantively from that in traditional retailing. Offline redemption of coupons is customer‐initiated while Internet shoppers are usually prompted to enter a code towards the conclusion of the checkout process. This prompting may influence shopper perceptions and behaviors such as shopping cart abandonment. Results showed strong negative effects on price fairness, satisfaction, and purchase completion in the code‐absent group and positive effects on fairness and satisfaction in the code‐present group. Presents implications for effective market segmentation through the use of online coupon codes.