When Do Limited Time Offers Work? A Reactance Perspective

Marketers often use limited-time offers to attract customers. For example, retailers make offers that are for "one week only"; flash sales websites make offers stating "today's deal" or "deal expires in one hour"; and online shopping portals make limited-time offers with a countdown clock ticking down the remaining time. Given the popularity of limited time offers, it is important to understand when these offers do or do not work in terms of improving product evaluation. Past research has found that putting any kind of restriction on offers - such as time restriction or quantity restriction - tends to increase product evaluation because restrictions prompt consumers to make inferences of product value (Inman et al. 1997; Parker and Lehman 2011). The present research extends this literature by applying the theoretical lens of reactance to limited time offers, and showing that the positive effect of limited time offers on product evaluation is moderated by factors related to reactance.