Innovativeness and Price Sensitivity among Smart Phone Users: An Empirical Study
Purpose: Price sensitivity is one of the key factors that affect pricing choices for companies. In the smartphone market, however, business practitioners face problems in pricing decisions because they are ignorant of the price sensitivity and its dynamics among their customers. Consumer Innovativeness is a tendency to welcome new products and to accept them. Researchers believe that innovative consumers are comparatively more price insensitive than other consumers. This study therefore aims to concentrate on this unexplored field in order to provide more accurate tools for the effective pricing of their Smart Phones in the global market. Design/methodology/approach: This research on Smart Phone Users is being carried out in the Emirate of Ajman, UAE. The emphasis is on exploring how Smart Phone innovativeness influences the degree of price sensitivity. 360 questionnaires were collected through a quantitative survey and the sample data is analyzed using multiple regression analysis and explanatory factor analysis. Findings: The result of this analysis confirmed the psychometric soundness of the self report measure of price sensitivity and this study replicated the previous results of the negative correlation between Price sensitivity and innovativeness. The study’s remarkable achievement is also that the consumers ‘price perceptions and innovativeness levels are valid measures of their price sensitivity. Research limitations/Implications: This paper focused solely on Smart phone users in the emirate of Ajman. Cross-cultural research on the application of the variables of this analysis should be carried out in order to build a reliable collection of measures for international use. Practical implications: The most distinctive result of this paper for market practitioners is a new set of factors by which consumer segmentation can be rendered more accurately. Originality/value: The findings of this paper allow smart phone business to increase the efficiency of pricing of smart phones in the global market.