Multichannel customer purchase behavior and long tail effects in the fashion goods market |
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| Institution: | 1. Sam M. Walton College of Business, The University of Arkansas, Fayetteville, AR, USA;2. The Naveen Jindal School of Management, The University of Texas at Dallas, Richardson, TX, USA;1. DePaul University, Driehaus College of Business, 1 E. Jackson Blvd., Chicago, IL 60604, United States;2. University of Zagreb, Faculty of Economics & Business Zagreb, Trg J. F. Kennedyja 6, 10000 Zagreb, Croatia;3. Northwestern University, Medill School of Journalism, Media, Integrated Marketing Communications, 1845 Sheridan Road, Evanston, IL 60208, United States;4. Keio University, Graduate School of Business Administration, 4-1-1 Hiyoshi, Kohoku, Yokohama 2238526, Japan;1. Department of Management and Marketing, Saginaw Valley State University, University Center, MI 48710;2. Department of Marketing and Supply Chain Management, The University of Memphis, Memphis, TN 38152;3. Department of Marketing, Darla Moore School of Business, University of South Carolina, Columbia, SC 29208;4. Department of Marketing, Wayne State University, 2771 Woodward Ave, Detroit, MI 48201;1. Neeley School of Business, Texas Christian University, TCU Box 298530, Fort Worth, TX, 76129, USA;2. Smeal College of Business, The Pennsylvania State University, 455 Business Building, University Park, PA, 16802, USA;1. Management & Marketing Department, John L. Grove College of Business, Shippensburg University;2. Area of Marketing and Supply Chain Management, Rawls College of Business, Texas Tech University, 703 Flint Avenue, MS 2101, Lubbock, TX, 79409;1. University of Edinburgh, Business School, Edinburgh, United Kingdom;2. University of Southampton, Southampton Business School, Southampton, United Kingdom;3. University of Central Florida, College of Business, Orlando, United States |
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| Abstract: | The fast-paced growth of e-commerce is impacting the type and variety of products consumers purchase across channels. A commonly held theory, known as long tail theory, posits that online sales are less concentrated at the top of the sales distribution than offline sales, and that more variety is bought online, making the tails of the overall sales distribution denser with the growth of e-commerce. Most of the literature testing the long tail theory has focused on examining entertainment goods markets that do not require much physical examination, and has predominantly found results consistent with the theory. However, the magnitude and antecedents of the observed long tail effects might be different for product categories containing products that require more physical examination before purchase, such as fashion goods. In this study, using detailed individual and transaction level panel data from two multichannel fashion goods retail brands, we show that while the shift to the online channel results in a decrease in the concentration of overall sales for both brands, this change mostly results from consumers buying different products online rather than consumers buying a greater variety online compared to offline. We show that the flattening of the overall sales distribution with the growth of e-commerce in our data is driven by consumers sorting their purchases into channels based on product characteristics. In contrast to the recommendations from the previous long tail literature, our results show that fashion apparel retailers do not need to offer broader assortments online compared to offline, but they may find it profitable to carry or emphasize a different product mix online compared to offline. Our results also provide guidance to fashion goods retailers in curating their online and offline assortments and setting inventory management strategies across the channels. |
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