Divide and Prosper: Consumers
Morwitz first author, NYU Stern; Greenleaf NYU Stern; Johnson then at Wharton. This is the origin of the term. In the authors' account, many firms divide a product's price into two mandatory parts, such as the base price of a mail-order shirt and a shipping and handling surcharge, rather than charging one all-inclusive price; they call this partitioned pricing. Firms presumably use it to raise demand and profits, but there was little clear empirical support or theoretical explanation for why it would. Findings: partitioned prices lower consumers' recalled total costs and raise demand.
Morwitz first author, NYU Stern; Greenleaf NYU Stern; Johnson then at Wharton. This is the origin of the term. In the authors' account, many firms divide a product's price into two mandatory parts, such as the base price of a mail-order shirt and a shipping and handling surcharge, rather than charging one all-inclusive price; they call this partitioned pricing. Firms presumably use it to raise demand and profits, but there was little clear empirical support or theoretical explanation for why it would. Findings: partitioned prices lower consumers' recalled total costs and raise demand.
Written from the abstract read 2026-10-18.
What our sources record
Recorded when this source was checked, figures included, with page references and quotation marks removed.
Reactions to Partitioned Prices.' Journal of Marketing Research, 35(4), 453-463. doi:10.1177/002224379803500404.