Doob, A.N., Carlsmith, J. M., Freedman, J. L, Landauer, T. K., & Tome, S., Jr., Effect of Initial Selling Price on Subsequent Sales. JPSP, 1969, 11, 345-350

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While many marketers use the "introductory low price" to spur trial with the hopes of better sales at a higher normal price later, the opposite may be true.

According to cognitive dissonance theory, the more a person has to "work" to attain a goal, the more they may like it. This would indicate the the more someone intially pays for a product, the more they will like it, producing brand loyalty for future purchases. While more people may initially buy the product at the lower price, eventually these two demand curves will cross some time in the future.

The price experiment was conducted at a chain of discount houses where they do little advertising They tested it among "house brands" of the store. They assigned twelve pairs of stores (matched on total sales) to one of two conditions.

Experiment 1
In one store they started at $.25 for mouthwash and later raised to 0.39. The other store introduced and maintained a 0.39 price. They found that while the initial sales were much higher in the low price store, the curves crossed afater three weeks and remained higher overall for the store who introduced at the higher price.

Experiments 2-5
They replicated the experiment with more store pairs using toothpaste, aluminum foil, lightbulbs, and cookies. The results were duplicated in all products.

The conclusion is that introducing products at lower than usual price is harmful to future sales. It could be thre result of cognitive dissonance, or because people associate the product with the initial low price and don't see the value at the higher price.