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Saving money or losing face? An international study on social stigmatization in discount stores

Social stigmatization is detrimental to its victims, leaving them devalued and dis-criminated against by society. Can social stigmatization of marginalized low ‐ income social groups also influence non ‐ stigmatized high ‐ status consumers? If so, does the individual's cultural value of power distance (PD) moderate this relationship? Previous consumer research on social stigmatization has neglected these questions. In a discount ‐ store context, we analyze the moderating effect of an individual's cultural value of PD on the link between the social stigmatization of low ‐ income customers and the customer loyalty of higher ‐ income customers. In an international scenario ‐ based experimental study, we collected data in the United Kingdom, Germany, China, and Russia, resulting in a sample size of 1675 consumers. The empirical findings, which are based on structural equation modeling with latent variables, show the positive direct and negative indirect relationship between the social stigmatization of low ‐ income customers and the customer loyalty of higher ‐ income customers. The results of a multi ‐ group causal analysis indicate that an individual's cultural value of PD strongly influences the strength of this relationship. These findings demonstrate that social stigmatization has stronger effects on individuals with a high level of PD.