• Currency Face Values and Upgrade Intentions

Abstract

In many industries, sales depend on attracting new users and convincing existing users to upgrade to newer models. Consumers are also increasingly able to purchase these products in foreign markets. This research explores　how the face value of the foreign currency used to pay for a product influences future upgrade intentions, and it　examines the effects of possible moderators. The results of three experiments are evidence that consumers express　lower upgrade intentions when they perceive higher sunk costs in the original purchase. This occurs when　the foreign currency face value of the owned product is a multiple rather than a fraction of the consumer’s home　currency. However, the currency face value effect occurs only when the temporal delay is short, consumers know　the correct exchange rate, and consumers lack currency conversion experience. These findings have significant　impli-cations for both theory development and marketing practice.

Keywords: Currency Face Value, Upgrade Intention, Sunk Cost, Temporal Delay, Currency Conversion Experience