Usage complementarity vs. basket co-occurrence: Discount depth reliance in digitally personalized product recommendations

Abstract

The present research investigates how recommending products based on usage complementarity versus basket co-occurrence affects consumers’ purchase decisions. Across seven studies, we find that recommending products based on purchase co-occurrence leads consumers to overly rely on discount depth while neglecting the base price. However, recommending products based on usage complementarity attenuates this tendency. We propose that this occurs because, when products are highly complementary, consumers adopt a comprehensive (vs. topical) mental account that evaluates price information more holistically, considering both discount depths and base prices, thereby reducing the processing bias such as base price neglect. Consistent with our proposal, we find that usage complementarity mitigates another type of processing bias—arising from consumers’ motivation to justify hedonic (vs. utilitarian) purchases—indicating that complementarity promotes a more comprehensive approach to price evaluation. We also find that complementarity triggers a processing style similar to the analytical processing style associated with prevention orientation (vs. promotion orientation), which involves comprehensive price evaluations.