Online Purchase Paths and Conversion Dynamics across Multiple Websites

Low transportation costs online allow shoppers to visit multiple e-commerce sites for a purchase decision. This research investigates online shoppers’ visit and purchase behaviors across competing websites. To consider that shoppers’ longitudinal cross-site visit data may consist of several unobserved shopping episodes, we propose a modeling approach to probabilistically clustering and relating online visits to latent shopping episodes, based on the temporal patterns of the visit events. The inferences are then used to examine shoppers’ visit-to-purchase behavior across websites. Using Internet clickstream data on individual-level browsing and transaction records at major air travel sites, we find that online shoppers’ cross-site visit patterns tend to be clustered and the purchase propensity is significantly higher at later visits within a visit cluster, compared to earlier visits. As our results suggest the possibility that visit clusters can serve as a reasonable proxy for shopping episodes, we look further into shoppers’ website choice and purchase behaviors within a cluster. We discuss how the cluster-based analysis can help managers tailor online marketing and advertising strategies based on shoppers’ cross-site visit and purchase patterns.     

The roles of multiple channels in predicting website visits and purchases: Engagers versus closers

In today’s online environment, consumers and sellers interact through multiple channels such as email, search engines, banner ads, affiliate websites and comparison-shopping websites. In this paper, we investigate whether knowing the history of channels the consumer has used until a point of time is predictive of their future visit patterns and purchase conversions. We propose a model in which future visits and conversions are stochastically dependent on the channels a consumer used on their path up to a point. Salient features of our model are: (1) visits by consumers are allowed to be clustered, which enables separation of their visits into intra- and inter-session components, (2) interaction effects between channels where prior visits and conversions from channels impact future inter-session visits, intra-session visits and conversions through a latent variable reflecting the cumulative weighted inventory of prior visits, (3) each channel attracts inter-session and intra-session visits differently, (4) each channel has different association with conversion conditional on a customer’s arrival to the website through that channel, (5) each channel engages customers differently (i.e., keeps the customer alive for a next session or for a next visit within a session), (6) the channel from which there was an arrival in the previous session can have an enhanced ability to generate an arrival for the same channel in the current session (channel persistence), and (7) parsimonious specification for high dimensionality in a low-velocity, sparse-data environment. We estimate the model on easy-to-collect first-party data obtained from an online retailer selling a durable good and find that information on the identities of channels and incorporation of inter- and intra-session visits have significant predictive power for future visitation and conversion behavior. We find that some channels act as “closers” and others as “engagers”—consumers arriving through the former are more likely to make a purchase, while consumers arriving through the latter, even if they do not make a purchase, are more likely to visit again in the future or extend the current session. We also find that some channels engage customers more than others, and that there are interaction effects between the channels visited. Our estimates show that the effect of prior inventory of visits is different from the immediate prior visit, and that visit and purchase probabilities can increase or decrease based on the history of channels used. We discuss several managerial implications of the model including using the predictions of the model to aid in selecting customers for marketing actions and using the model to evaluate a policy change regarding the obscuring of channel information.     

Online search – Online purchase in franchising: An empirical analysis of franchisor website functionality

The aim of this paper is to characterize franchisors’ e-commerce strategies by studying their website functionality. Franchisors can use their website to facilitate consumer search. They can also provide content and tools to promote online purchasing (e.g., promotion codes, online payment, delivery options). Why are some franchisor websites more “search oriented”? What are the factors that influence the provision of informational tools and/or transactional tools? This empirical study is based on a detailed observation of 130 e-commerce websites of franchisors operating their chains in the French market.     

“Showrooming” in Consumer Electronics Retailing: An Empirical Study

The present study focuses on multichannel retailing strategies and describes the state of consumer behavior regarding “showrooming” (the practice of examining merchandise or products in a retail store and then buying it online). Founded on the theory of planned behavior (TPB), the authors examine the antecedents of showrooming using data collected from a sample of 176 retail consumers. Based on their results, they define perceived control, website compatibility, and subjective norms as the main antecedents of consumer attitudes toward online purchases. Additionally, they state that previous experience and reasons against purchasing online are directly associated with consumers’ intention to purchase on the retailer’s website. Finally, some theoretical conclusions and practical implications for retailers are discussed.     

The risk of programmatic advertising: Effects of website quality on advertising effectiveness

Programmatic advertising is prevalent in online advertising. However, it offers managers limited control over the type of website where the ad appears, resulting in brand safety issues. Aware of the risk that ads may potentially display on websites of poor quality (nonpremium websites), managers have developed strategies to reduce this risk. Due to the lack of empirical insights, these strategies are based on “gut feeling” and depend on campaign type (branding versus performance) and brand type (premium versus nonpremium). Our research addresses this void and analyzes website quality effects for premium and nonpremium brands in branding and performance campaigns. Our results show that effects, indeed, vary depending on campaign and brand type, but not in ways that managers might expect. When a branding ad appears on a nonpremium website, attitudes towards the ad and the brand deteriorate, but only for premium brands. In contrast, website quality does not affect awareness for either type of brand. When a performance ad appears on a nonpremium website, it generates fewer clicks; this effect is stronger for premium brands. Overall, these findings enrich our understanding of the consequences of programmatic advertising and highlight the crucial role of website quality dependent on campaign goal and brand type.     

Consumer Analysis in Ethnic Live Seafood Markets in the Northeast Region of the United States

During September through November of 2006, in-store intercept surveys of consumers who buy live seafood in retail markets in New Jersey, New York, and Pennsylvania revealed that the average live seafood consumer makes 6.2 visits per month, spends $14.80 per visit on live seafood, travels 7.8 miles mainly by car, and is purchasing for 3.7 people in his or her household. Consumers value physical appearance of the product over price, generally have no preference for either “Product of the USA” or imported, and generally have no preference for either wild-caught or farm-raised. Many had no preference whether their fish was alive or dead before leaving the store, but if the fish is to be slaughtered in-store, preferred to have their fish gutted or filleted. Consumers generally prefer to purchase live seafood during the winter months and on either a Friday or Saturday.     

What retailers need to understand about website inaccessibility and disabled consumers: Challenges and opportunities

This research uniquely contributes to the marketing policy literature by illuminating the widespread yet seldom studied problem of online inaccessibility of retail websites affecting approximately 30 million disabled Americans. When a website is not designed to be navigated easily or is not compatible with assistive technology such as a screen-reader, these potential customers are not able to independently search for information and conduct transactions. Blind and low vision participants in an empirical study provide their opinions regarding accessibility policy issues and reveal that their frustrations with inaccessible retail websites may result, not only in avoidance of the retailer in its different sales channels but also in antifirm behaviors driven by negative attitudes toward perceived retailer accessibility/disability policy that spur feelings of online marketplace discrimination. Using two different evaluation tools, the top 100 retailers in the United States were evaluated on the accessibility of their websites over the past 4 years (2015–2018). Results show that most websites contain many design errors making navigation very difficult or even impossible for vision impaired consumers. The argument is made that online retailers who proactively address these inaccessibility issues on their websites may significantly increase their customer base and profitability.     

Offline and Online Search in Used Durables Markets

This study examines how different information sources are used by consumers prior to their purchase of used durable goods, specifically used cars. We examine how online and offline search are related. Categories of online sources are dealer websites and resale websites, and of offline sources are print media and dealer visits. Prior research on new car purchases finds that online sources substitute for traditional, offline sources such as dealer visits. We examine whether this theory extends to used-car purchases and distinguish between dealer websites and resale websites (a distinction relevant to used-goods markets) by collecting data from a sample of used-car buyers. Because search in different sources can be interrelated, and due to data censoring, we build and estimate a simultaneous equations Tobit model. In contrast to existing research, we find that online search on dealer websites is complementary to and not a substitute for dealer visits. This complementary effect highlights the importance of dealers’ web presence in used markets.     

How customer engagement in the live-streaming affects purchase intention and customer acquisition,E-tailer's perspective

In the emerging retail market, e-tailers operating in developing economies have to cope with the rapid use of the Internet, new electronic purchasing methods and online selling platforms. However, e-tailers do not understand the effect patterns in which customer engagement on purchase intention and customer acquisition. From e-tailers’ perspective, this study explores how customer engagement behaviors are related to both purchase intention and customer acquisition. We obtained live streaming data in the mature e-tail live streaming market environment and found empirical evidence supporting the conceptual framework through regression model analysis. The analysis results show that the specific indicators of the customer engagement are not all positively related to customer purchase intention and customer acquisition, and it is worth noting that the influence of “like” behavior on customer acquisition is no statistical significance. This is expected to encourage e-tailers to rethink their focus on customer acquisition and sales enhancement digital strategies as they operate in emerging markets.     

The use of event related potentials brain methods in the study of Conscious and unconscious consumer decision making processes

The question of whether consumer purchasing decisions are conscious choices or unconscious has long been studied in marketing. The ability to measure mental changes with high temporal resolution makes the EEG-based event-related potentials (ERP) method very useful in studying the distinction between consciousness and unconsciousness. Although experiences with brands significantly affect the awareness or unconsciousness of decisions to purchase, ERP studies have ignored experiences of consumers in relation to brand purchases. For this purpose, EEG recordings of participants were taken in the order they saw brand names: experienced brands, review-based brands, and unknown brands. Participants chose one of the three options for the brands they saw on the screen: buying, not buying, and no idea. 35 people participated in the study. The results indicate that early ERPs, which are unconscious mental reactions, related to purchase decisions for previously unknown brands. Late ERPs associated with conscious mental reactions are related to purchasing review-based brands or experienced brands. We conclude that purchasing decisions about unknown brands occur as a result of automatic, unconscious mental processes, whereas purchasing decisions about previously experienced brands and based on consumer reviews result from conscious mental processes. Our study is the first that demonstrates the relationship between ERP's and purchasing decisions, with an experimental design focused on consumer experience and consciousness.     

Perceived customer showrooming behavior and the effect on retail salesperson self-efficacy and performance

The increasing product commoditization and price transparency afforded by online retail channels have left many brick and mortar stores bearing the costs associated with being used as a physical showroom without reaping the rewards of the final sale. As customers continue to take advantage of retail stores to gather information and turn to competing channels for purchasing, the role of the retail salesperson has shifted and retailers have been left without a clear understanding of how to manage this change in the retailing landscape. In this research, we first define “showrooming” – and investigate individual (i.e., salesperson)-level experiential consequences of perceived showrooming. We find negative relationships between perceived showrooming and salesperson self-efficacy and salesperson performance, which are positively moderated by salesperson coping strategies and cross-selling strategies. Our findings suggest that the negative effects of showrooming can be combated though specific salesperson behaviors and strategies. Further, exploratory findings at the store level reaffirm a negative relationship between perceived showrooming behaviors and performance. Finally, we discuss the theoretical and practical implications of our findings and offer specific managerial actions to address showrooming.     

Does the internet defy the law of gravity?

We show that gravity holds in the case of digital goods consumed over the Internet that have no trading costs. Therefore trade costs cannot fully account for the effects of distance on trade. In particular, we show that Americans are more likely to visit websites from nearby countries, even controlling for language, income, immigrant stock, etc. Furthermore, we show that this effect only holds for taste-dependent digital products, such as music, games, and pornography. For these, a 1% increase in physical distance reduces website visits by 3.25%. For non-taste-dependent products, such as software, distance has no statistical effect.     

Exploring the Selective Use of Ad Blockers and Testing Banner Appeals to Reduce Ad Blocking

Ad blocker proliferation threatens the revenue streams of many websites and raises fears about the viability of digital advertising as a whole. Although industry initiatives have increasingly aimed to mitigate ad blocking, surprisingly little research addresses the problem. It remains largely unknown which factors drive ad blocking or help unblocking or “whitelisting” of select websites. This article presents an exploratory survey study of 1,634 ad blocker users and uncovers the main factors driving ad blocking and conditions for unblocking select websites. The conditions suggest changes to online advertising in line with current industry initiatives, as well as opportunities for direct appeals to ad blocker users. A field experiment with 294,331 users tests whether banner appeals can reduce ad blocking. The results show that these appeals reduce ad blocking among 1% of the ad blocker users, and among frequent visitors who encounter repeated banner appeals, this percentage increases to 2%. However, repeated banners also lead to fewer website visits of users not conforming to the appeal, which suggests a trade-off between reducing ad blocking among some users and further increasing avoidance behaviors among others.     

Engaging the unengaged customer: The value of a retailer mobile app

Mobile apps are becoming a go-to tactic for retailers because they offer the promise of highly convenient digital engagement. We hypothesize that two types of customers are best served by these apps — “offline-only” customers currently purchasing exclusively from the retailer's physical store, and “distant” customers who reside far from the physical store. For offline-only customers, the app complements the physical engagement they currently have. For distant customers, the app offers convenient engagement their remoteness currently precludes. We model app access and purchase behavior of 629 customers who downloaded a retailer's app. We find that apps generate more incremental sales among distant customers compared to near customers, and more incremental sales among offline-only customers compared to online customers. On an illustrative base of 100 K app users, we find accessing the app would generate $2.3 M in incremental sales. Consistent with our segmentation results, we find that the users with the greatest purchase lift (9.5%) due to app usage are those that are distant and offline-only. Our results confirm the economic value of retailer apps and their role as a segmentation strategy to enhance customer engagement.     

The Showrooming Phenomenon: It's More than Just About Price

This paper examines the factors that influence competitive showrooming, whereby consumers visit an offline retail store to gather information but make their purchase online at a competing retailer. We survey 556 respondents to study how the benefits and costs of showrooming influence the consumer's decision to showroom. Not surprisingly, we find that expected average price savings from showrooming are positively associated with showrooming. In addition, however, the perceived dispersion in online prices is also positively related to showrooming. Moreover, we find that non-price factors play a key role in consumers' showrooming decisions: perceived gains in the quality of the product purchased when showrooming (measured as the fit with a consumer's need) and waiting time for service in the brick-and-mortar store are positively associated with showrooming. Online search costs are negatively related to showrooming. Time pressure that consumers face when shopping is negatively associated with their propensity to showroom. We discuss implications for researchers and retail managers. For example, managers of offline retail stores can curtail showrooming by increasing the number of sales personnel available in-store instead of providing currently employed personnel with more training. To encourage showrooming, managers of online retailers should make it easier for the customer to search online.     

Uppercase Premium Effect: The Role of Brand Letter Case in Brand Premiumness

Researchers have recently begun investigating how visual elements affect brand positioning. However, little is known about the effect of brand typeface features on brand premiumness. This paper proposes and verifies that letter case affects consumers’ perceived brand premiumness. Eight experiments, including one eye-tracking experiment, reveal that consumers perceive brands that use all uppercase letters (“uppercase brands”) as more premium than those that use all lowercase letters (“lowercase brands”). We refer to this effect as the “uppercase premium effect.” This effect is induced by the perceived conspicuousness of uppercase brands, a process which in turn is moderated by the product's social visibility. The effect is reversed for consumers who prefer subtle signals (“inconspicuous consumers”) because these consumers are likely to perceive a conspicuous uppercase brand as gaudy. Whereas status-motivated consumers are more likely to choose uppercase brands due to the increased premiumness perceptions, the increment in such perceptions does not further influence the purchase decisions of consumers indifferent to expressing status. We conclude with a discussion of theoretical and practical implications and offer suggestions for further research.     

Retail therapy: A strategic effort to improve mood

“Retail therapy” is often applied to the notion of trying to cheer oneself up through the purchase of self‐treats. The negative moods that lead to retail therapy, however, have also been associated with greater impulsivity and a lack of behavioral control. Does this lead to mindless shopping when consumers are “down” and regret later? The current work documents that a bad mood does lead to greater purchase and consumption of unplanned treats for the self. However, it also provides evidence that the consumption of self‐treats can be strategically motivated. Those individuals who do indulge can also exercise restraint if the goal of restraint also leads to improved mood. Finally, retail therapy has lasting positive impacts on mood. Feelings of regret and guilt are not associated with the unplanned purchases made to repair a bad mood. The implications of the research are discussed. © 2011 Wiley Periodicals, Inc.     

Does Online Information Drive Offline Revenues?: Only for Specific Products and Consumer Segments!

While many offline retailers have developed informational websites that offer information on products and prices, the key question for such informational websites is whether they can increase revenues via web-to-store shopping. The current paper draws on the information search literature to specify and test hypotheses regarding the offline revenue impact of adding an informational website. Explicitly considering marketing efforts, a latent class model distinguishes consumer segments with different short-term revenue effects, while a Vector Autoregressive model on these segments reveals different long-term marketing response.We find that the offline revenue impact of the informational website critically depends on the product category and customer segment. The lower online search costs are especially beneficial for sensory products and for customers distant from the store. Moreover, offline revenues increase most for customers with high web visit frequency. We find that customers in some segments buy more and more expensive products, suggesting that online search and offline purchases are complements. In contrast, customers in a particular segment reduce their shopping trips, suggesting their online activities partially substitute for experiential shopping in the physical store. Hence, offline retailers should use specific online activities to target specific product categories and customer segments.     

Studying patterns of consumer's grocery shopping trip

Previous research on (grocery) shopping trips has focused on studying the relationship between shopping frequency and shopper's demographic characteristics. Recognizing that shoppers are heterogeneous in terms of their shopping trip regularity as well as shopping frequency, we propose a mixture model of the exponential and the Erlang-2 distribution with heterogeneous frequency for shopping trip intervals. Applied to IRI (Information Resources, inc.) shopping trip data, we found that 70 percent of shoppers visit grocery stores with random intervals and 30 percent with relatively fixed intervals. We also found clear differences between these “random” and “routine” shoppers in terms of several demographic and purchase behavioral characteristics. The “routine” shoppers are identified to have higher opportunity costs which make it difficult for them to visit grocery stores more often and/ or to switch stores. However, they spend more dollars for a given shopping trip. Finally, we discuss managerial iniplications of segmenting shoppers by their shopping trip regularity.     

An investigation of factors affecting the visits of online crowdsourcing and labor platforms

Nowadays, the economic activities have become increasingly digital since hundreds of millions of Internet users are using crowdsourcing platforms either to work at an online job as workers, or as a model of problem-solving and production as requesters. This growing workforce makes it necessary from the perspective of the online platforms, to fully understand the business dimensions of this emerging and innovative “online labor” phenomenon, which can rapidly change the future of work and work organization in the online world. This paper aims to investigate and analyze the visits of online labor platforms that offer crowdsourcing and crowdfunding services. Using websites’ metrics data drawn from Alexa for the time period 2012-2016 the paper uses Ordinary Least Squares (OLS) and Fixed Effects (FE) regression analysis to examine correlations between visits and website characteristics. The research shows that the sessions of an online labor marketplace website from mobile devices have an increasing trend to be positively correlated to the quality mechanisms a website deploys as well as on location-dependent factors. The results are expected to provide insights on how the online labor website characteristics affect their traffic and thus inform about their evolution and improvement.