The Free Breakfast Effect

Juan L. Nicolau and Ricardo Sellers, both of the University of Alicante, published “The Free Breakfast Effect: An Experimental Approach to the Zero Price Model in Tourism” on November 3rd, 2011 in the OnlineFirst section of the Journal of Travel Research. Other OnlineFirst articles can be found here.

The abstract:

This article presents the first evidence of the zero price effect in tourism. The multicomponent nature of tourism products adds complexity to the price-setting process, but also allows managers to take advantage of the interrelationships among the different components to maximize sales. Taking the zero price model, the authors adapt and apply it to a two-component tourism product. The experiments conducted show evidence in favor of the free breakfast effect: even though people lean toward their preferred, more expensive alternative, when the cheaper option offers a free breakfast, the demand for the latter increases and for the former it decreases. This result shows that the zero price effect is not confined to single products but also applies in multicomponent contexts. Important managerial implications in the realm of sales promotion policies are drawn.

To learn more the Journal of Travel Research, please follow this link.

Are you interested in receiving email alerts whenever a new article or issue becomes available online? Then click here!

Bookmark and Share

[polldaddy rating=”4667602″]
0 0 votes
Article Rating

Business & Management INK

Business and Management INK puts the spotlight on research published in our more than 100 management and business journals. We feature an inside view of the research that’s being published in top-tier SAGE journals by the authors themselves.

Notify of

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Inline Feedbacks
View all comments
Would love your thoughts, please comment.x