Engagement in online communities: implications for consumer price perceptions

Abstract

Modern consumers are engaged in online communities where interaction with paying and non-paying customers impacts their knowledge and perceptions of marketing strategies such as dynamic pricing practice. Given the increased transparency of pricing strategies due to information sharing via online platforms, service providers need to understand the extent to which online communities influence consumer perceptions of price fairness. Drawing from social information processing and social identity theories, we argue that online community engagement is positively related to consumers’ perceptions of the fairness of dynamic pricing strategies, and this relationship is fully mediated by community norms and rule familiarity. We further find the positive effect of community norms on perceived price fairness is stronger among consumers with a higher degree of online savviness.