Double Mental Discounting: How a Single Promotional Rebate Feels Twice as Nice

The phenomenon of "double discounting" in consumer behavior is discussed. Double discounting occurs when consumers mentally apply a promotional rebate to reduce the costs of both Purchase 1 and Purchase 2. Here, Cheng and Cryder hypothesize that this phenomenon occurs because both purchases feel coupled with the rebate gains. In a series of four studies, they explore the double discounting effect. Study 1 demonstrates that a promotional rebate reduces the subjective cost across two purchases to a greater extent than a direct discount of the same value applied to one of the purchases. Study 2 shows that framing rebate gains as windfalls exacerbates double discounting effects. Study 3 aims to mitigate double discounting effects through decoupling rebate gains from Purchase 1 by prompting consumers to deliberate what they will spend their rebates on. Study 4 demonstrates that offering a promotional rebate with Purchase 1 can encourage consumers to choose a more expensive product at Purchase 2.