Credence Goods in Online Markets: An Empirical Analysis of Returns and Sales After Returns

While e-commerce sales continue to grow, product returns remain a key risk for online retailers’ profitability. At the same time, credence goods such as sustainable products become increasingly important in retailing. This study aims to combine these two developments and empirically investigates the effect of credence goods on product returns and sales after returns in e-commerce. Furthermore, we assess how third-party assurances can help organizations to positively affect customer behavior and reduce product returns of credence goods. Our research is based on unique data from a large-scale online field experiment with 35,000 customers combined with data of more than one million past transactions of these customers. Surprisingly, the results reveal that credence goods are associated with lower product returns than experience goods. Adding a third-party certificate to the online product description helps to reduce product returns and increase sales after returns. We find that customer relationship strength and price consciousness act as boundary conditions for the certificate to reduce product returns. Our research contributes to signaling theory and extends IS literature on product uncertainty and returns to the field of credence goods. Furthermore, we provide relevant insights for e-commerce practitioners on how to manage sales and returns of credence goods

GENERATING CONSUMER INSIGHTS FROM BIG DATA CLICKSTREAM INFORMATION AND THE LINK WITH TRANSACTION-RELATED SHOPPING BEHAVIOR

E-Commerce firms collect enormous amounts of information in their databases. Yet, only a fraction is used to improve business processes and decision-making, while many useful sources often remain underexplored. Therefore, we propose a new and interdisciplinary method to identify goals of consumers and develop an online shopping typology. We use k-means clustering and non-parametric analysis of variance tests to categorize search patterns as Buying, Searching, Browsing or Bouncing. Adding to purchase decision-making theory we propose that the use of off-site clickstream data—the sequence of consumers’ advertising channel clicks to a firm’s website—can significantly enhance the understand-ing of shopping motivation and transaction-related behavior, even before entering the website. To run our consumer data analytics we use a unique and extensive dataset from a large European apparel company with over 80 million clicks covering 11 online advertising channels. Our results show that consumers with higher goal-direction have significantly higher purchase propensities, and against our expectations - consumers with higher levels of shopping involvement show higher return rates. Our conceptual approach and insights contribute to theory and practice alike such that it may help to improve real-time decision-making in marketing analytics to substantially enhance the customer experience online

HOW ONLINE CUSTOMER REVIEWS AFFECT SALES AND RETURN BEHAVIOR – AN EMPIRICAL ANALYSIS IN FASHION E-COMMERCE

The goal of this study is to get a better understanding of the relationship between online customer re-views (OCRs), product returns and sales after returns in online fashion. Furthermore, we generate deeper insights about the moderating role of mobile shopping usage, product involvement and brand equity in this context. We answer our research questions by empirically analyzing a unique data set from a European fashion e-commerce company. This study links a wide range of transaction data (2.5 billion page clicks, 46 thousand different products, 700 brands, 40 product categories, 72 million sold and 33 million returned items) with a large set of OCRs (0.9 million). Our results show that positive OCRs can lead to lower return rates, higher sales after returns, and better conversion rates. Consider-ing higher search costs on mobile devices, we reveal a weaker impact of OCRs in the mobile than in the desktop sales channel. Furthermore, in line with involvement theory, we see a significant impact of product involvement in this context such as the influence of positive OCRs is stronger for high-involvement products than vice versa. Moreover, we find support for statements from brand signaling literature, that OCRs matter more for weak than for strong brands

THE IMPACT OF CEOS’ TECHNOLOGICAL FRAME ON ORGANIZATIONAL AGILITY AND THE MEDIATING EFFECT OF DIGITAL BUSINESS CAPABILITIES: AN EMPIRICAL ANALYSIS

The information systems (IS) literature elaborates on how firms develop organizational agility based on organizational capabilities to sense and respond to rapidly changing environments. However, the underlying mechanism of how companies and their chief executive officers (CEOs) understand and implement digital technologies to foster organizational agility is lacking. The technological frame concept provides an impetus to explain the process by which CEOs’ sensemaking of digital technologies influences organizational agility. Our paper draws on the individual-level perspective of the technological frame concept and proposes a mediating role of digital business capabilities, composed of digital strategy, digital integration, and digital control. Our quantitative research design is based on findings derived from 386 German CEOs and confirms that CEOs’ technological frame influences organizational agility through digital business capabilities. Thereby, we expand the concept of the technological frame on the individual level and contribute to the IS literature by revealing the mechanism of how CEOs’ sensemaking influences organizational agility

Product Uncertainty in Online Markets: The Influence of Situational Factors and Individual Characteristics on Purchase Decision Reversal

E-commerce has traditionally suffered from significantly higher product return rates than offline retail (30 % online vs. 10 % offline). Product uncertainty at the time of purchase has been identified as one of the key drivers of purchase decision reversals in online markets. In this study we analyze the impact of situational factors (1. Purchase channel choice, 2. Time pressure) and individual differences on product uncertainty and purchase decision reversal. Following the conceptualization of product uncertainty by Hong and Pavlou (2014), we distinguish between product fit uncertainty and product quality uncertainty. To test our hypotheses, we employ a large-scale empirical analysis based on panel data from a large European online fashion retailer. We find that product fit uncertainty is higher for mobile channel users, which is attenuated by prior brand experience. Time pressure leads to lower return rates despite higher product uncertainty

Investors’ Digital Myopia - The Information Value of Being Digital

Portraying a digital business strategy seems to be what capital markets are looking for in firms. Tech companies raise staggering amounts of capital and long-established companies that announce a digital business strategy double their firm value over night. By drawing from information economics literature, this study investigates drivers and outcomes of a firm’s digital business strategy by utilizing the new construct of a firm-wide digital orientation. Applying a cross-industry longitudinal study, results indicate that initial public offerings provide financial flexibility to drive a firm’s digital orientation. Yet, against expectations, capital markets react negatively to firms depicting a digital orientation post share issuance. We explain this finding on the basis of investors’ digital myopia. Our analysis yields surprising, yet promising results

Мотивация и стимулирование персонала на современных предприятиях

In a modern, rapidly developing world, the human factor is perhaps the most important factor of production. Therefore, the management company must maintain competent personnel policies that will enable employees to realize their full potential in the organization. Motivation and stimulation of personnel is the cornerstone of modern management. The results of the work of the organization depends on the engagement of staff in labour, the desire to benefit

“Digital In, Digital Out?“ – Evidence for a Curvilinear Relationship Between IT Experience in Top Management Teams and Firms’ Digital Orientation

To drive digital transformation, firms are increasingly adding IT-experienced executives to their top management team (TMT). Yet, whether IT-experienced executives can aid firms to achieve digital transformation remains unresolved theoretically and empirically. Drawing on human capital and group literature, we propose that there are limits to the benefits received from adding IT-experienced executives to a TMT, resulting in a curvilinear relationship between the share of IT-experienced executives in the TMT and a firm’s digital orientation. We also propose that this relationship is moderated by CEO entrepreneurial orientation and power concentration in the TMT. We test and find support for most of our hypotheses using a secondary panel data set comprising 1,855 firm-year observations from 256 firms listed in the S&P 500 between 2005 and 2017

Genetic diversity and gain : the concept of a status number

A trade-off always tends to exist involving genetic gains and selection intensity, on the one hand, and the remaining effective population size (usually known as Ne), on the other. A new approach is presented and analysed for different breeding situations, using stochastic simulations, in terms of mating designs and subline sizes, guiding breeders through a new concept of status number (Ns) and its trade-off with gain. Status number is defined as half the inverse of the average coancestry and depicts the current state of the population. The status number concept can easily be applied to deployment of different genotypes with unequal representation. Breeding schemes with small breeding groups are slightly more efficient in preserving status number through multiple generations than breeding schemes with large groups. Medium- to large-size breeding groups showed a comparatively small reduction in aggregated status number over generations but showed greater increases in gain compared with small groups. Inbreeding in small elites becomes so great that it is likely to cause fertility problems and disturb selection considerably. Small breeding groups will probably not be useful for a sustainable long-term breeding strategy. Substantial benefits on status number for subdividing the population into small breeding groups will only be seen after numerous generations. Selection schemes that maximise gain by unrestricted combined index selection will result in rapid inbreeding, and may not be sustainable in the long term. Selection procedures that place less emphasis on family information would best meet long-term diversity targets. However, gains may be too low for mating systems and selection procedures that do not include a between-family component, especially with low heritabilities. This is a good reason for using a large number of families as founders of the breeding population. Going from selection within only 0.5 or 1 available cross per parent per generation (made equivalent to within-family selection) to 2.5 crosses per parent (restricting the number of individuals chosen per full-sib family) resulted in substantial increases in genetic gain, depending on heritability. However, increasing the number of crosses per parent up to 2.5 does carry a modest penalty of increased coefficient of inbreeding and reduced status number. Higher levels of gain per unit of status number loss are obtained with a conservative within family selection strategy but to reach the same level of gain more cycles of breeding will be required. Effects of departures from assumptions (zero inbreeding coefficient and coancestry for the founders, genes being independently assorted, no mutation and interactions, or combinations from departures of the neutrality assumption) , singly and in various combinations will occur, meaning that calculations and predictions based on pedigrees will be biased. Future work will require modelling the effects for departures from the idealised assumptions and laboratory-based quantification of departures from some key assumptions