Buyers’ Choice of Online Search Strategy and its Managerial Implications

June 2006 | Sen, Ravi

Internet offers several tools such as shopping bots and search engines that help potential buyers search for lower prices. This paper defines a buyer’s online-search strategy as using one or more of these tools to search for lower prices, and empirically investigates the validity of economics of information search theory in explaining his choice of a particular online-search strategy. We find that a buyer’s attitude towards the price offered by his preferred online seller, his perception of online price dispersion, and his awareness of shopping agents have a significant affect on his choice of online-search strategy. An understanding of buyers’ choice of online-search strategies can help an online seller to estimate its expected probability of making an online sale, optimize its online pricing, and improve its online promotional and advertising activities.

Author

Co-author(s)

  • Ruth C. King
  • Michael J. Shaw

Publication(s)

Journal of Management Information Systems