Abstract: A discount pricing strategy is one of the most effective marketing tools to enhance sales of products in various market domains. Although it is also extensively used in the information technology (IT) industry, little prior research has examined its effects in the context of IT products. This research investigated the effects of the discount pricing in the context of the online video game market based on Software-as-a-Service (SaaS). Analyzing a large empirical panel data, this research found that the strategy has a positive effect on the sales of online video games. It also illustrated that discount rate and the amount of a discounted price have positive effects on the sales while the number of the competitors utilizing a discount pricing strategy has a negative effect.
Keywords: SaaS, Online Video Game, Discount Pricing, Panel Data, Price Fairness, Perceived Value, Utility Theory, Competition Theory
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Recommended Citation: Choi, H., Medlin, D., Hunsinger, S. (2017). The Effects of Discount Pricing Strategy on Sales of Software-as-a-Service (SaaS): Online Video Game Market Context. Journal of Information Systems Applied Research, 10(1) pp 55-64. http://jisar.org/2017-10/ ISSN: 1946-1836. (A preliminary version appears in The Proceedings of CONISAR 2016)