Business Administration Master's program with thesis

The rise of online retail has brought convenience and accessibility to consumers worldwide. However, it has also led to the proliferation of false promotions and deceptive pricing practices, which exploit cognitive biases and manipulate consumer perceptions. This thesis aims to investigate the prevalence, tactics, and impacts of these deceptive practices in the online retail industry. It utilizes an in-depth analysis of three prominent Saudi e-commerce platforms in terms of volume of sales and examines the price history of 100 items selected by non-probability stratified sampling method. The research uncovers the alarming extent of fake or misleading discounts, with a majority of items utilizing false anchoring tactics to create a false sense of value. The findings highlight a widespread issue with 94% of discounts recorded in the sample pool being fake or misleading. False anchoring strategies are utilized by 75% of analyzed items, and 73% of tested items are consistently on discount, raising concerns about the authenticity of these promotions. The findings underline the urgent need for consumer awareness and critical evaluation of pricing strategies in the online marketplace. The thesis proposes a new anchored price calculation method using two new equations to provide a fairer and more objective anchored price based on the historical pricing data and potential adjustments based on changes in consumer demand and supply chain disruptions. Furthermore, the introduction of the Verified Sale Price Tag offers a practical solution to identify false or deceptive sale tactics, enabling consumers to make informed purchasing decisions. This thesis has theoretical contribution to the literature by emphasizing the importance of a trustworthy and transparent marketplace that prioritize consumer trust and foster a more informed and ethical shopping experience. It also has practical policy suggestions for consumers, retailers and regulatory bodies not only in Saudi Arabia but also in other parts of the world.