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<p>This study examines how pricing effectiveness in durable goods markets varies with product age and seasonal demand conditions. We develop a structural framework that jointly models consumer demand and retail pricing, allowing sensitivity to price and product age to vary across seasons. The model is estimated using weekly data on sales, retail prices, and wholesale prices from a Chinese mobile phone retailer, with wholesale prices providing cost-side information that improves identification. We find that price sensitivity increases with product age and is further amplified during peak demand periods, while consumer aversion to product ageing is substantially stronger for higher-priced models. These patterns imply that the effectiveness of price discounts varies systematically across product age and season. As a result, optimal markdown strategies should adjust to lifecycle and seasonal conditions in addition to any inventory pressure.</p>

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Price, product age, and seasonality: evidence on consumer sensitivity in durable goods market

  • 期刊论文

  • 发表日期：

    2026年7月2日

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  • Wenshu Zhang,
  • Charles Moul,
  • Jia Li

摘要

This study examines how pricing effectiveness in durable goods markets varies with product age and seasonal demand conditions. We develop a structural framework that jointly models consumer demand and retail pricing, allowing sensitivity to price and product age to vary across seasons. The model is estimated using weekly data on sales, retail prices, and wholesale prices from a Chinese mobile phone retailer, with wholesale prices providing cost-side information that improves identification. We find that price sensitivity increases with product age and is further amplified during peak demand periods, while consumer aversion to product ageing is substantially stronger for higher-priced models. These patterns imply that the effectiveness of price discounts varies systematically across product age and season. As a result, optimal markdown strategies should adjust to lifecycle and seasonal conditions in addition to any inventory pressure.