The purpose of the present study is to investigate the economic and social impacts of business-to-consumer (B2C) e-commerce in the small retail sector of certain commodities in Thailand. A primary sample survey was conducted for the collection of data from the north, northeast, central and southern regions of the country during the months of January to March 2018. The data were collected from small retail outlets of books and magazines, cosmetics, mobile, and laptop who have adopted online sales with physical shop, and doing exclusively offline sales. The total sample size of the study was 1462 units. The results revealed that adoption of online sales in retailing by small retailers could raise their profitability in the short-term, medium-term, and long-term periods. However, the operating efficiency of the firms measured in terms of operating expenses and their social impact calculated by new employment generation and increased employee compensation were not laudable in Thailand on their transformation from brick-and-mortar to click-and-mortar stores. Another important observation of the study is that the non-adoption of online sales is highly prevalent in the small enterprise segment of retailing in Thailand.
{"title":"Impact of B2C E-Commerce on Small Retailers in Thailand: An Investigation Into Profitability, Operating Efficiency, and Employment Generation","authors":"Varughese Kizhakkacharuvil John, N. Vikitset","doi":"10.2139/ssrn.3309472","DOIUrl":"https://doi.org/10.2139/ssrn.3309472","url":null,"abstract":"The purpose of the present study is to investigate the economic and social impacts of business-to-consumer (B2C) e-commerce in the small retail sector of certain commodities in Thailand. A primary sample survey was conducted for the collection of data from the north, northeast, central and southern regions of the country during the months of January to March 2018. The data were collected from small retail outlets of books and magazines, cosmetics, mobile, and laptop who have adopted online sales with physical shop, and doing exclusively offline sales. The total sample size of the study was 1462 units. The results revealed that adoption of online sales in retailing by small retailers could raise their profitability in the short-term, medium-term, and long-term periods. However, the operating efficiency of the firms measured in terms of operating expenses and their social impact calculated by new employment generation and increased employee compensation were not laudable in Thailand on their transformation from brick-and-mortar to click-and-mortar stores. Another important observation of the study is that the non-adoption of online sales is highly prevalent in the small enterprise segment of retailing in Thailand.","PeriodicalId":370988,"journal":{"name":"eBusiness & eCommerce eJournal","volume":"446 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2019-01-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133281643","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2019-01-01DOI: 10.7200/ESICM.162.0501.2I
Aitziber Núñez Zabaleta
Purpose: This study analyzes the opinion of business managers as to the usefulness of Social Media tools for their job, along with the specific tasks they were involved in.
Design: Six in-depth interviews were held with six business managers working for eight companies; seven in The Basque region in Spain and one in Germany.
Findings: The study shows that regardless of the particular Social Media strategy of the company where they worked, all managers had a profile on several social networking sites. The monitoring being done on SM went beyond observing what the competition was doing in relation to their specific business; it also observed the strategy that competitors, customers and suppliers implemented in the Social Media.
Limitations: Most of the interviewees worked for B2B companies in the Basque region of Spain.
Practical implications: Practitioners and managers can learn about what their colleagues are doing in the sphere of SM. This study provides an idea of how to integrate the SM strategy within the overall corporate strategy, making efficient use of these tools, and thus achieving their communication goals.
{"title":"Social Media Use by Managers From B2B Companies in the Basque Region of Northern Spain.","authors":"Aitziber Núñez Zabaleta","doi":"10.7200/ESICM.162.0501.2I","DOIUrl":"https://doi.org/10.7200/ESICM.162.0501.2I","url":null,"abstract":"Purpose: This study analyzes the opinion of business managers as to the usefulness of Social Media tools for their job, along with the specific tasks they were involved in.<br><br>Design: Six in-depth interviews were held with six business managers working for eight companies; seven in The Basque region in Spain and one in Germany.<br><br>Findings: The study shows that regardless of the particular Social Media strategy of the company where they worked, all managers had a profile on several social networking sites. The monitoring being done on SM went beyond observing what the competition was doing in relation to their specific business; it also observed the strategy that competitors, customers and suppliers implemented in the Social Media.<br><br>Limitations: Most of the interviewees worked for B2B companies in the Basque region of Spain.<br><br>Practical implications: Practitioners and managers can learn about what their colleagues are doing in the sphere of SM. This study provides an idea of how to integrate the SM strategy within the overall corporate strategy, making efficient use of these tools, and thus achieving their communication goals.","PeriodicalId":370988,"journal":{"name":"eBusiness & eCommerce eJournal","volume":"35 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2019-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"125879337","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2018-12-12DOI: 10.35609/jmmr.2018.3.4(4)
Mohamed Osman Shereif Mahdi Abaker, Hanan Ali Al-Shehhi
Objective - This study investigates the impact of the educational portal on employee performance in the Ministry of Education (MOE) in the Sultanate of Oman. It examines employee perceptions of the benefits of the educational portal used by the MOE. The educational portal provided by the MOE is the main gateway for various types of educational related online services to users. This research focuses on the factors of educational portal services, which facilitates work, and improve employee performance. Methodology/Technique - The research adopts a quantitative methodology and collects data by means of questionnaires. Findings - The findings suggest that the educational portal technology has a positive impact on employee performance. The results also reveal that the employee performance has increased since the introduction of educational portal services compared with employee performance based on the previous manual system. Novelty - This calls for a systematic and periodic review of the educational portal services, to update the technology and accommodate for new requirements. Type of Paper: Empirical Keywords: Educational Portal; Online Services; Portal Technology; Information Technology; Employee Performance; Sultanate of Oman. JEL Classification: M10, M12, M19.
{"title":"Educational Portals and Employee Performance in the Sultanate of Oman","authors":"Mohamed Osman Shereif Mahdi Abaker, Hanan Ali Al-Shehhi","doi":"10.35609/jmmr.2018.3.4(4)","DOIUrl":"https://doi.org/10.35609/jmmr.2018.3.4(4)","url":null,"abstract":"Objective - This study investigates the impact of the educational portal on employee performance in the Ministry of Education (MOE) in the Sultanate of Oman. It examines employee perceptions of the benefits of the educational portal used by the MOE. The educational portal provided by the MOE is the main gateway for various types of educational related online services to users. This research focuses on the factors of educational portal services, which facilitates work, and improve employee performance.\u0000\u0000Methodology/Technique - The research adopts a quantitative methodology and collects data by means of questionnaires.\u0000\u0000Findings - The findings suggest that the educational portal technology has a positive impact on employee performance. The results also reveal that the employee performance has increased since the introduction of educational portal services compared with employee performance based on the previous manual system.\u0000\u0000Novelty - This calls for a systematic and periodic review of the educational portal services, to update the technology and accommodate for new requirements.\u0000Type of Paper: Empirical\u0000\u0000Keywords: Educational Portal; Online Services; Portal Technology; Information Technology; Employee Performance; Sultanate of Oman.\u0000\u0000JEL Classification: M10, M12, M19.","PeriodicalId":370988,"journal":{"name":"eBusiness & eCommerce eJournal","volume":"303 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-12-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132635414","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper aims to review the research of electronic commerce and the effects of information technology on electronic commerce. This paper begins with a review of the electronic commerce, internet, and protocol internet. Finally, this paper discusses electronic trade security and implications for accountant professionals. In brief, the concept of e-commerce is trade transactions using electronic devices that connected each other in a virtual space. E-commerce has significant positive impact both for businesses, consumers or society.
{"title":"An Overview of Electronic Commerce","authors":"Monica, Vina Victor Lie, Marselinus Asri","doi":"10.2139/ssrn.3299134","DOIUrl":"https://doi.org/10.2139/ssrn.3299134","url":null,"abstract":"This paper aims to review the research of electronic commerce and the effects of information technology on electronic commerce. This paper begins with a review of the electronic commerce, internet, and protocol internet. Finally, this paper discusses electronic trade security and implications for accountant professionals. In brief, the concept of e-commerce is trade transactions using electronic devices that connected each other in a virtual space. E-commerce has significant positive impact both for businesses, consumers or society.","PeriodicalId":370988,"journal":{"name":"eBusiness & eCommerce eJournal","volume":"16 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-12-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130922448","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Ron Berman, L. Pekelis, Aisling Scott, Christophe Van den Bulte
We investigate to what extent online A/B experimenters “p-hack” by stopping their experiments based on the p-value of the treatment effect, and how such behavior impacts the value of the experimental results. Our data contains 2,101 commercial experiments in which experimenters can track the magnitude and significance level of the effect every day of the experiment. We use a regression discontinuity design to detect the causal effect of reaching a particular p-value on stopping behavior. Experimenters indeed p-hack, at times. Specifically, about 73% of experimenters stop the experiment just when a positive effect reaches 90% confidence. Also, approximately 75% of the effects are truly null. Improper optional stopping increases the false discovery rate (FDR) from 33% to 40% among experiments p-hacked at 90% confidence. Assuming that false discoveries cause experimenters to stop exploring for more effective treatments, we estimate the expected cost of a false discovery to be a loss of 1.95% in lift, which corresponds to the 76th percentile of observed lifts.
{"title":"p-Hacking and False Discovery in A/B Testing","authors":"Ron Berman, L. Pekelis, Aisling Scott, Christophe Van den Bulte","doi":"10.2139/ssrn.3204791","DOIUrl":"https://doi.org/10.2139/ssrn.3204791","url":null,"abstract":"We investigate to what extent online A/B experimenters “p-hack” by stopping their experiments based on the p-value of the treatment effect, and how such behavior impacts the value of the experimental results. Our data contains 2,101 commercial experiments in which experimenters can track the magnitude and significance level of the effect every day of the experiment. We use a regression discontinuity design to detect the causal effect of reaching a particular p-value on stopping behavior. \u0000 \u0000Experimenters indeed p-hack, at times. Specifically, about 73% of experimenters stop the experiment just when a positive effect reaches 90% confidence. Also, approximately 75% of the effects are truly null. Improper optional stopping increases the false discovery rate (FDR) from 33% to 40% among experiments p-hacked at 90% confidence. Assuming that false discoveries cause experimenters to stop exploring for more effective treatments, we estimate the expected cost of a false discovery to be a loss of 1.95% in lift, which corresponds to the 76th percentile of observed lifts.","PeriodicalId":370988,"journal":{"name":"eBusiness & eCommerce eJournal","volume":"169 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-12-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"129916258","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The impact of aggregators on news outlets is ambiguous. In particular, the existing theoretical literature highlights that although aggregators create a market expansion effect when they bring visitors to news outlets, they also generate a substitution effect if some visitors switch from the news outlets to the aggregators. Using the shutdown of the Spanish edition of Google News in December of 2014 and difference-in-differences methodology, this paper empirically examines the relevance of these two effects. We show the shutdown of Google News in Spain decreased the number of daily visits to Spanish news outlets by 11%, and that this effect was larger in sports outlets than in national and regional outlets. We then analyze the effect of the opt-in policy adopted by the German edition of Google News in October of 2014. Although such policy did not significantly affect the daily visits of all outlets that opted out, it reduced by 7% the number of visits of the outlets controlled by the publisher Axel Springer. Our results demonstrate the existence of a market-expansion effect through which news aggregators increase consumers' awareness of news outlets' contents, thereby increasing their number of visits. We find no evidence of a substitution effect in our two empirical settings.
{"title":"What Do News Aggregators Do? Evidence from Google News in Spain and Germany","authors":"Joan Calzada, Ricard Gil","doi":"10.2139/ssrn.2837553","DOIUrl":"https://doi.org/10.2139/ssrn.2837553","url":null,"abstract":"The impact of aggregators on news outlets is ambiguous. In particular, the existing theoretical literature highlights that although aggregators create a market expansion effect when they bring visitors to news outlets, they also generate a substitution effect if some visitors switch from the news outlets to the aggregators. Using the shutdown of the Spanish edition of Google News in December of 2014 and difference-in-differences methodology, this paper empirically examines the relevance of these two effects. We show the shutdown of Google News in Spain decreased the number of daily visits to Spanish news outlets by 11%, and that this effect was larger in sports outlets than in national and regional outlets. We then analyze the effect of the opt-in policy adopted by the German edition of Google News in October of 2014. Although such policy did not significantly affect the daily visits of all outlets that opted out, it reduced by 7% the number of visits of the outlets controlled by the publisher Axel Springer. Our results demonstrate the existence of a market-expansion effect through which news aggregators increase consumers' awareness of news outlets' contents, thereby increasing their number of visits. We find no evidence of a substitution effect in our two empirical settings.","PeriodicalId":370988,"journal":{"name":"eBusiness & eCommerce eJournal","volume":"11 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-12-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"125593725","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This is a quantitative research that contribute an idea about the role of effective and efficient e-commerce on SMEs in Jakarta, to prepare for globalization era and Indonesian demographic bonus 2030. Jakarta has the most comprehensive infrastructure regarding to the business cycle, payment service, shipping service and authorization process in implementing e-commerce. The purpose of this research is to examine the information system usage on business performance. 100 respondents gained to support this research, examine by using partial least square method, with period of data gathering and analysis from January 2016 to January 2017. The research finding, e-commerce usage influence on business performance is not supported, effective information system influence on e-commerce usage is supported, effective information system influence on business performance is supported, efficient information system influence on e-commerce usage is supported, efficient information system influence on business performance is not supported.
{"title":"Effective, Efficient and the Use of E-commerce for Small and Medium Enterprise in Jakarta","authors":"Tifa Noer Amelia","doi":"10.2139/ssrn.3284259","DOIUrl":"https://doi.org/10.2139/ssrn.3284259","url":null,"abstract":"This is a quantitative research that contribute an idea about the role of effective and efficient e-commerce on SMEs in Jakarta, to prepare for globalization era and Indonesian demographic bonus 2030. Jakarta has the most comprehensive infrastructure regarding to the business cycle, payment service, shipping service and authorization process in implementing e-commerce. The purpose of this research is to examine the information system usage on business performance. 100 respondents gained to support this research, examine by using partial least square method, with period of data gathering and analysis from January 2016 to January 2017. The research finding, e-commerce usage influence on business performance is not supported, effective information system influence on e-commerce usage is supported, effective information system influence on business performance is supported, efficient information system influence on e-commerce usage is supported, efficient information system influence on business performance is not supported.","PeriodicalId":370988,"journal":{"name":"eBusiness & eCommerce eJournal","volume":"180 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-11-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"116318308","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The online clothing businesses have seen a considerable rise in recent times, with a high and growing demand. The purpose of this study is to determine the factors that play significant roles in creating purchase intention towards the online clothing products in Bangladesh. Secondary research was used to build the model of customer purchase intention. A structured questionnaire was employed to gather data and test the model. Factor analysis and regression were used to test the model. The regression model suggested that customer purchase intention was induced most by the online marketing activities of the online retailers, followed by pricing strategy implemented and sense of security provided (in that order). To understand customer purchase intentions better, it may be important to look at additional factors or seek better measures of the constructs. The study suggests that online retailers should heavily focus on online promotions and pricing.
{"title":"Factors Affecting Consumer Purchase Behavior Towards Online Clothing Products in Bangladesh","authors":"Tasin Islam","doi":"10.2139/ssrn.3286105","DOIUrl":"https://doi.org/10.2139/ssrn.3286105","url":null,"abstract":"The online clothing businesses have seen a considerable rise in recent times, with a high and growing demand. The purpose of this study is to determine the factors that play significant roles in creating purchase intention towards the online clothing products in Bangladesh. Secondary research was used to build the model of customer purchase intention. A structured questionnaire was employed to gather data and test the model. Factor analysis and regression were used to test the model. The regression model suggested that customer purchase intention was induced most by the online marketing activities of the online retailers, followed by pricing strategy implemented and sense of security provided (in that order). To understand customer purchase intentions better, it may be important to look at additional factors or seek better measures of the constructs. The study suggests that online retailers should heavily focus on online promotions and pricing.","PeriodicalId":370988,"journal":{"name":"eBusiness & eCommerce eJournal","volume":"11 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-11-02","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126218169","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Md Adnan Rahman, Shamim Ahmed Khan, A. B. Abdul Hamid, A. Latiff, Rosli Mahmood
The purpose of this paper is to measure the impact of electronic word of mouth (e-WOM) on brand image and online purchase intention of shopping products among Bangladeshi consumers. Bangladesh is experiencing rapid growth in terms of e-business and e-commerce. Consequently, the practice of online shopping is gaining popularity in Bangladesh; investigation regarding the impact of e-WOM and brand image on online purchase intention has remained mostly unexplored in Bangladeshi context. Therefore, it will be an interesting finding to see how e-WOM affects the brand image and online purchase intention of shopping products in Bangladesh. Necessary data is collected through a structured online questionnaire from 233 Bangladeshi university students who are familiar with e-WOM and online purchase phenomenon. Non-probability convenience sampling technique is used for sample selection. Overall data were analysed with the help of IBM SPSS Statistics 22 and AMOS version.23 Structural equation modeling (SEM). Results from data analysis show that e-WOM affects both brand image and purchase intention positively. This present study on Bangladeshi consumers’ online buying intention could provide a better understanding of customer adoption of the Internet as a shopping and transaction channel. Findings of this research can help marketers to improve online shopping practice in Bangladesh. As the growth of e-commerce in Bangladesh, there is a crucial need to be aware of what makes Bangladeshi consumers shop online. Furthermore, the research could hypothetically subsidize to the literature of e-WOM on the online purchase intention in Bangladesh.
{"title":"Impact of Electronic Word of Mouth (e-WOM) on Brand Image and Online Purchase Intention: The Perspective of Bangladesh","authors":"Md Adnan Rahman, Shamim Ahmed Khan, A. B. Abdul Hamid, A. Latiff, Rosli Mahmood","doi":"10.2139/ssrn.3490628","DOIUrl":"https://doi.org/10.2139/ssrn.3490628","url":null,"abstract":"The purpose of this paper is to measure the impact of electronic word of mouth (e-WOM) on brand image and online purchase intention of shopping products among Bangladeshi consumers. Bangladesh is experiencing rapid growth in terms of e-business and e-commerce. Consequently, the practice of online shopping is gaining popularity in Bangladesh; investigation regarding the impact of e-WOM and brand image on online purchase intention has remained mostly unexplored in Bangladeshi context. Therefore, it will be an interesting finding to see how e-WOM affects the brand image and online purchase intention of shopping products in Bangladesh. Necessary data is collected through a structured online questionnaire from 233 Bangladeshi university students who are familiar with e-WOM and online purchase phenomenon. Non-probability convenience sampling technique is used for sample selection. Overall data were analysed with the help of IBM SPSS Statistics 22 and AMOS version.23 Structural equation modeling (SEM). Results from data analysis show that e-WOM affects both brand image and purchase intention positively. This present study on Bangladeshi consumers’ online buying intention could provide a better understanding of customer adoption of the Internet as a shopping and transaction channel. Findings of this research can help marketers to improve online shopping practice in Bangladesh. As the growth of e-commerce in Bangladesh, there is a crucial need to be aware of what makes Bangladeshi consumers shop online. Furthermore, the research could hypothetically subsidize to the literature of e-WOM on the online purchase intention in Bangladesh.","PeriodicalId":370988,"journal":{"name":"eBusiness & eCommerce eJournal","volume":"3 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-11-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"131591794","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The decoy effect (DE), first introduced by Huber et al. (1982), has been robustly documented across dozens of product categories and choice settings using lab experiments. However, in the literature, the DE has never been verified in a real marketplace. In this paper, we empirically test and quantify the DE in a major online diamond marketplace. We develop a diamond-level proportional hazard framework by jointly modeling market-level decoy-dominant detection probabilities and the boost in sales upon detection of dominants. Results suggest that decoy-dominant detection probabilities are low (10%-29%) in the diamond marketplace; however, upon detection, the DE increases dominant diamonds’ sales hazards significantly (2.3-4.4 times). To understand the DE’s managerial significance, we quantify its profit impact and find that it contributes 21.4% of the diamond retailer’s profit. Finally, we explore various strategies that might help the retailer to further increase profitability. We find that the retailer’s profit can increase up to 5.4% via effective utilization of the DE.
{"title":"Profiting from the Decoy Effect: A Case Study of the Online Diamond Marketplace","authors":"Chunhua Wu, Koray Cosguner","doi":"10.2139/ssrn.3271331","DOIUrl":"https://doi.org/10.2139/ssrn.3271331","url":null,"abstract":"The decoy effect (DE), first introduced by Huber et al. (1982), has been robustly documented across dozens of product categories and choice settings using lab experiments. However, in the literature, the DE has never been verified in a real marketplace. In this paper, we empirically test and quantify the DE in a major online diamond marketplace. We develop a diamond-level proportional hazard framework by jointly modeling market-level decoy-dominant detection probabilities and the boost in sales upon detection of dominants. Results suggest that decoy-dominant detection probabilities are low (10%-29%) in the diamond marketplace; however, upon detection, the DE increases dominant diamonds’ sales hazards significantly (2.3-4.4 times). To understand the DE’s managerial significance, we quantify its profit impact and find that it contributes 21.4% of the diamond retailer’s profit. Finally, we explore various strategies that might help the retailer to further increase profitability. We find that the retailer’s profit can increase up to 5.4% via effective utilization of the DE.","PeriodicalId":370988,"journal":{"name":"eBusiness & eCommerce eJournal","volume":"4 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-10-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121232636","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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