Advertisement

An Investigation of Online Group-Buying Institution and Buyer Behavior

  • Chuan-Hoo Tan
  • Khim-Yong Goh
  • Hock-Hai Teo
Part of the Lecture Notes in Computer Science book series (LNCS, volume 4553)

Abstract

This study draws on interdependency theory to propose and assess the effects of two artifacts - conditional purchase and information cue - on decisional choice in the online group-buying context. Our results suggest that buyers presented with conditional purchase options (i.e., of not honoring the purchase when the expected discount price is not met) are more willing to make a purchase choice (i.e., deviate from an inactive inertia). Counter-intuitively, provision of information cues (i.e., information about procurement actions of the other buyers) appears to induce inaction. However, when a choice has to be made between a riskier and a less risky choice, the presence of information cues leads to a higher propensity for the riskier choice. Implications for theory and practice are further discussed.

Keywords

Electronic market group-buying interdependence theory 

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. 1.
    Huber, B., Sweeney, E., Smyth, A.: Purchasing Consortia and Electronic Markets – A Procurement Direction in Integrated Supply Chain Management. Electronic Markets 14, 284–294 (2004)CrossRefGoogle Scholar
  2. 2.
    Hendrick, T.E.: Purchasing Consortiums: Horizontal Alliances among Firms Buying Common Goods and Services. What? Who? Why? How? Tempe, AZ: Center for Advanced Purchasing Studies / National Association of Purchasing Management (1997)Google Scholar
  3. 3.
    Al-Oirim, N.A.Y.: Electronic Commerce in Small to Medium-Sized Enterprises: Frameworks, Issues, and Implications. Idea Group Pub., Hersey, PA (2004)Google Scholar
  4. 4.
    Anand, K.S., Aron, R.: Group Buying on the Web: A Comparison of Price-Discovery Mechanisms. Management Science 49, 1546–1562 (2003)CrossRefGoogle Scholar
  5. 5.
    Dhar, R., Nowlis, S.M.: The Effect of Time Pressure on Consumer Choice Deferral. Journal of Consumer Research 25, 369–384 (1999)CrossRefGoogle Scholar
  6. 6.
    Tversky, A., Kahneman, D.: Advances in Prospect Theory: Cumulative Representation of Uncertainty. Journal of Risk and Uncertainty 5, 297–323 (1992)zbMATHCrossRefGoogle Scholar
  7. 7.
    Anderson, C.J.: The Psychology of Doing Nothing: Forms of Decision Avoidance Result From Reason and Emotion. Psychological Bulletin 129, 139–167 (2003)CrossRefGoogle Scholar
  8. 8.
    Dhar, R.: Consumer Preference for a No-Choice Option. Journal of Consumer Research 24, 215–231 (1997)CrossRefGoogle Scholar
  9. 9.
    Rusbult, C.E., Van Lange, P.A.M.: Interdependence, Interaction, and Relationships. Annual Review of Psychology 54, 351–375 (2003)CrossRefGoogle Scholar
  10. 10.
    Kauffman, R.J., Wang, B.: Bid Together, Buy Together: On the Efficacy of Group-Buying Business Models in Internet-based Selling. In: Lowry, P.B., Cherrington, J.O., Watson, P.R. (eds.) Handbook of Electronic Commerce in Business Society, CRC Press, Boca Raton, FL (2002)Google Scholar
  11. 11.
    Kauffman, R.J., Wang, B.: New Buyers’ Arrival under Dynamic Pricing Market Microstructure: The Case of Group-Buying Discounts of the Internet. Journal of Management Information Systems 18, 156–188 (2001)Google Scholar
  12. 12.
    Kelley, H.H., Holmes, J.G., Kerr, N.L., Reis, H.T., Rusbult, C.E., Van Lange, P.A.M.: An Atlas of Interpersonal Situations. Cambridge, New York (2003)Google Scholar
  13. 13.
    Kelley, H.H.: Expanding the Analysis of Social Orientations by Reference to the Sequential-Temporal Structure of Situations. European Journal of Social Psychology 27, 373–404 (1997)CrossRefGoogle Scholar
  14. 14.
    Van Lange, P.A.M., Visser, K.: Locomotion in Social Dilemmas: How People Adapt to Cooperative, Tit-For-Tat and Noncooperative Partners. Journal of Personality and Social Psychology 77, 762–773 (1999)CrossRefGoogle Scholar
  15. 15.
    Giebels, E., De Dreu, C.K.W., Van de Vliert, E.: The Alternative Negotiator as the Invisible Third at the Table: The Impact of Potency Information. The International Journal of Conflict Management 9, 5–21 (1998)Google Scholar
  16. 16.
    Giebels, E., De Dreu, C.K.W., Van de Vliert, E.: Interdependence in Negotiation: Effects of Exit Options and Social Motive on Distributive and Integrative Negotiation. European Journal of Social Psychology 30, 255–272 (2000)CrossRefGoogle Scholar
  17. 17.
    Shiller, R.J.: Conversation, Information, and Herd Behavior. American Economic Review 85, 181–186 (1995)Google Scholar

Copyright information

© Springer-Verlag Berlin Heidelberg 2007

Authors and Affiliations

  • Chuan-Hoo Tan
    • 1
  • Khim-Yong Goh
    • 1
  • Hock-Hai Teo
    • 1
  1. 1.National University of Singapore, Department of Information Systems, 3 Science Drive 2, 117543Singapore

Personalised recommendations