Table 2 - uploaded by Andrea Pozzi
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This paper explores differences in consumers' grocery shopping behavior when they shop online and in a brick-and-mortar store. To do so, I assemble a new scanner dataset that tracks customers' grocery purchases in-store and on the Internet. This allows comparison in behavior of the same households, shopping in the same chain, for identical items an...
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... For each locality, we first gather a pool of existing MICROE-only firms (~5 per locality). We then assign the markets in equal proportions to one of three groups: control (no entry), treatment 1 (+1 additional vendor each, representing a 25% increase relative to either baseline vendorship or eligible non-financial firms), complementarity in consumption, reflecting synergies in consumption (Gentzkow 2007, Iaria and Wang 2020), or transport costs in shopping (Pozzi 2012, Thomassen et al. 2017), or preference for variety (Hendel 1999). 4 For detailed discussion and measurement of firm misconduct-failure to comply with rules/ laws/standards-which is prevalent and costly, see Egan, Matvos, and Seru (2019) and Annan (Forthcoming). ...
Abstract
We study the equilibrium effects of entry with bundling. Enlisting non-financial businesses to provide retail financial services is a widespread and scalable practice globally. This mixed financial and non-financial services setting naturally emerges as the market entry approach for several real-world financial markets, and can create a multiplier: both sectors respond separately, and if the services are strategic complements, this can lead to additional growth in the aggregate local services industry. In partnership with the two largest service providers in Ghana, we implement a three-step design that randomizes the entry of new financial mobile money vendors, who also sell non-financial goods/services, across local markets. Randomized entry decreases firm misconduct, increases service quality, and decreases price-cost markups, indicating positive consumer surplus. We find evidence of within-market revenue reallocation and expansion for mobile money, and a large services multiplier: revenues for non-financial goods/services increased by 20%, with aggregate service industry revenues increasing as well. These improvements emphasize the “real effects” of financial markets on the local economy, and come from adoption externalities and aggregate increase in household expenditures. Our findings demonstrate that entry increases local economic activity, not only by changing markets for digital financial services, but also by transforming the non-financial services sector. These effects are key ingredients for advancing basic and applied knowledge on firm entry with bundling in industry equilibrium.
JEL: D18, G23, L22, L26, O12, O16
Keywords: Randomized Entry, Externalities, Microenterprises, Mobile Money, Multiplier
... Typically, customers do not incur high product search costs. This tendency is more prominent in online contexts than in that of physical stores as product exploration is less prevalent online (Pozzi, 2012). Thus, the assumption of low search costs, which is central to the long-tail effect theory, does not exert a strong influence. ...
... Literature on multichannel retailing and consumer behavior suggests that customer inertia is more likely to occur during online grocery shopping. Pozzi (2012) analyzed customers' propensity to explore new brands in online and offline supermarket chains. The researcher found that customers are less likely to try new products online. ...
... Grocery purchases are often dominated by habitual routines and purchase involvement is low. Thus, product exploration is less likely to occur in online shopping (Pozzi, 2012), and the advantage of lower search costs in online shopping may not be as strongly affected. In addition, recommendations of popular products and past-purchase shortcuts may accelerate filter bubbles. ...
The long-tail effect, in which online retailing has a relative advantage in selling less popular products, has been studied extensively with e-commerce growth. However, recent research has raised questions that are more nuanced than originally considered. E-commerce can lead to customer demand concentration under specific conditions such as recommendations of popular products and past-purchase shortcuts. This study explores customer demand concentration in multichannel grocery retailing, a product category that involves low search costs. We use multichannel and multichain purchase panel data, which are representative of a large portion of online supermarkets in Japan. Our analysis shows that, compared with demand in physical stores, demand online is more concentrated on popular products. Furthermore, online shopping experience has a moderating effect, resulting in greater demand concentration among more experienced customers. These results are robust when controlling for available assortments across channels. These findings help retailers to develop inventory and customer relationship management.
... Concerning the variable of brand, we find that the online channel stickiness of consumers, in general, is positively associated with the brand differentiation. This is in line with the work of Pozzi (2012), which is by him explained as the fact that brand differentiation decreases the consumers' search cost and accelerate the process of consumers' brand exploration. Therefore, producers ought to design the differentiated products to adapt to the consumers' personalized needs. ...
... In addition, we can also notice that the online market elasticity of FRI, APT and MEA is less than the corresponding elasticity of three brands in traditional offline channel, which shows that the online consumption of OIM is insensitive to changes in consumers' income relative to the offline purchasing behavior. This is by Pozzi (2012) explained as the fact that brand features reducing the cost of online shopping are a main hurdle to online brand exploration relative to traditional offline channel. Furthermore, the different coefficient of brand implies that the consumers' multi-channel purchasing behavior relies on the marketing strategies' design of the different brand which is primarily under the control for OIM producers. ...
With the development of the Internet economy, online shopping has become the main way for consumers to obtain goods, especially for organic infant milk. Do millennials who grew up in the era of Internet prefer online purchasing channel? Or are they stickier to online channel than offline channel? To solve these issues, we conduct the regression analysis of a latent class and the model of Quadratic Engel Almost Ideal Demand System aimed at the user stickiness in China. Moreover, we further analyze the environmental social governance effect of multi-channel stickiness, which is able to further explore the impact of environmental social governance investment strategy on consumers’ purchasing behavior. Through these analyses, we confirm the online channel stickiness and platform stickiness of Taobao. Results also indicate that (i) The primary factor influencing the inertia of consumption and trade volume is the channel and platform stickiness, the latter positively affects the former. (ii) The ESG rating index plays a positively moderating role in the consumers’ user stickiness. (iii) Environment and Social Score have a significant positive impact on online platform stickiness.
... It has several distinctive characteristics in comparison to more traditional food markets, such as farmers' markets, grocery stores, or supermarkets. On the one hand, e-commerce significantly reduces information acquisition and search costs for consumers and provides a wider range of food choices (Pozzi, 2012;Richards et al., 2017). With the continuous investment in the logistics and distribution system at the county-township-village levels in China, the "last mile" of logistics has been connected. ...
E-commerce is gaining importance in the food sector of many countries, and its potential influence on people's access to food and dietary choices is yet to be thoroughly investigated. In this study, we analyze data from a food consumption survey conducted in rural China in 2021 to examine the impact of e-commerce on individual food consumption patterns and dietary quality. Our results with instrumental variable models show that e-commerce significantly reduces the consumption of staple foods, such as cereals and potatoes, while it increases the consumption of legumes, nuts, milk, and milk products, even after controlling for income and other confounding factors.
... The convenience of online shopping relates to features of the Internet that reduce the time consumers spend on viewing products, that they tend not to spend time on brand explorations, and are more likely to have repetitive behavior. In this case, pop-up advertising allows for brand trials, which encourage more online shopping [8]. This kind of advertisement helps people find more interest rather than keep loyalty to a few brands, which is really helpful for expanding people's purchase impulse to more brands. ...
... When viewing websites, advertisements can increase people's chances of online shopping. Pop-up advertising increases people's possibility of exploring more brands since they usually buy merchandise only on a relatively small scale of brands and stores online [8]. Targeting advertising recommends customers products that the big data assume customers would like [9]. ...
In the information era, people’s online consumption has been increasingly common. In recent years, since COVID-19 has affected people’s shopping behaviors offline to avoid unnecessary social contact, online shopping has become an essential part of people’s lives. Researches suggest that there are plenty of factors that have an effect on people’s action of consuming on the Internet. Those factors influence people’s behavior in a different way from offline shopping. This research aims at the cause that influences people’s online shopping behavior. In this review, an analysis based on present research will aim at people’s behavior affected by the online shopping model. Unlike offline stores, online shopping can offer people the unique consumption practice and shopping experiences. This article provides cohesive knowledge about research on how online shopping influences and changes people’s shopping behaviors. The results reveal people’s changes in shopping behaviors during consumption online and provide basic information for further studies.
... Tüketici davranışları, fiziksel kanallarda yapılan alışveriş ile sanal alışveriş kıyaslandığında farklılık gösterebilmektedir. Örneğin, her ne kadar sanal satış kanalı ile müşteriye ürün çeşitliliği sağlanıyor ve tüketim eğilimleri web sitesi önerileri ile yönlendirilmeye çalışılıyorsa da yapılan bir çalışma göstermektedir ki; tüketicinin daha önce deneyimlemediği bir ürüne yönelmesi fiziksel mağazada daha yüksektir (Pozzi, 2012). Bu durum, şirketler için yeni ürün veya marka tanıtımlarında sanal kanalların kullanımını sorgulanabilir kılmaktadır. ...
Tüketici davranışları, değişen yaşam koşulları doğrultusunda farklılaşmakta ve sanal market kullanımı her zamankinden daha yüksek bir hızla artmaktadır. Bu durum, pazarda rekabet eden firmaları yeni iş modelleri arayışına yöneltmekte ve sanal market sektöründe rekabet eden ve/veya sektöre yeni girmeyi hedefleyen firmaların hedef müşteri kitlesini anlayabilmeleri, pazar stratejilerini belirlemeleri açısından önem arz etmektedir. Bu çalışmada, sanal market kullanımına yönelen tüketici yapısını anlayabilmek amacı ile bir anket çalışması uygulanmış olup; anket sonuçları istatistiksel çıkarım yöntemleri ile incelenerek, sanal market kullanımını tercih eden tüketicilerin demografik yapısı belirlenmiştir. Daha sonra belirlenen demografik özellikler üzerinden, sınıflandırma problemleri için kullanılan çeşitli makine öğrenmesi teknikleri ile bireylerin sanal market kullanımları tahmin edilmiş ve kullanılan tahmin modelleri doğruluk performans ölçütü ile kıyaslanmıştır. Karşılaştırmalar sonucunda rasgele orman tekniği en yüksek doğruluk oranına ulaşmış olup bireylerin kullanım tercihleri %78 doğrulukla tahmin edilebilmiştir. Bunlara ek olarak, anket cevapları ışığında sanal market sektöründe faaliyet gösteren/gösterecek olan firmalara müşteri memnuniyeti üzerinde etken olabilecek faktörler hakkında bazı iç görüler sunulmuştur. Elde edilen sonuçlar, hızlı ve kullanımı kolay mobil aplikasyonlarla satış sonrası hizmetlerin müşterilerin sanal market kullanımını artırdığını, minimum tutar ve sınırlı teslimat bölgelerinin kullanımı azalttığını göstermiştir.
... It has several distinctive characteristics in comparison to more traditional food markets, such as farmers' markets, grocery stores, or supermarkets. On the one hand, e-commerce significantly reduces information acquisition and search costs for consumers and provides a wider range of food choices (Pozzi, 2012;Richards et al., 2017). With the continuous investment on the logistics and distribution system at the county-township-village levels in China, the "last mile" of logistics has been connected. ...
... in the Appendix depicts the own and cross-price elasticities in detail. The own-price elasticities are lower offline than online.Chu et al. (2010) andPozzi (2012) find that offline own-price elasticities are higher than online own-price elasticities. However, as I do in this paper, they estimate a brand choicemodel and not a store choice model. ...
E-commerce continues its expansion, and most retail groups have opened online distribution channels in the French grocery market. Using purchasing data, I develop a store choice model and a supply model to estimate the effect of the online distribution channel on consumer welfare and retail competition. E-commerce leads to a very small decrease in consumer surplus. Furthermore, only online leaders obtain more market shares and profits while the majority globally get lower market shares and profits with e-commerce.
... Studies have investigated various consumer topics about online food market, including searching behaviors (Benn et al., 2015;Richards et al., 2017;Rutsaert et al., 2015), purchasing behaviors (Breugelmans et al., 2007;De Vries et al., 2018;Milkman et al., 2010;Zheng et al., 2020), comparison with offline shopping behaviors (Chintagunta et al., 2012;Danaher et al., 2003;Huyghe et al., 2017;Pozzi, 2012;Wang et al., 2019), willingness to pay for particular attributes Olsen et al., 2017), and effects of consumer ratings and reviews (Heng et al., 2018;Lin et al., 2019). From a theoretical perspective, there are also studies exploring the factors driving the e-commerce transformation of the agriculture sector (Lu & Reardon, 2018) and its impacts (Baourakis et al., 2002;Leroux et al., 2001), firm's adoption and development strategies (Montealegre et al., 2007;Yang et al., 2020), and review of findings in the agri-food e-commerce field (Zeng et al., 2017). ...
In emerging economies where small farms are the main source of food supply, it is costly for the government to monitor and control food safety and production impact on the environment. However, the online food market can potentially give farmers stronger incentives to supply safer and more eco‐friendly products, as they can access a national market where consumers are interested in healthy food, and they can differentiate their products by providing production information using videos and pictures. This research uses the choice experiment method to elicit farmers’ preference for production practices and marketing channels in China where e‐commerce and delivery businesses are fast‐growing. Our main finding is that farmers perceive higher utility in selling safer and more eco‐friendly products than conventional products when using e‐commerce platforms, evidence of the online market's positive role in food safety enhancement. Our results also identify two types of farmers: traditional farmers and farmers open to the idea of online markets. Farmers who have higher education and live in villages with e‐commerce service centers are more likely to be the latter.
... Based on the analysis above, advertising appeals help to enhance consumers' attention to the quality of green agricultural products, reduce consumers' search costs and switching costs (Pozzi, 2012;Richards et al., 2017), enhance consumers' knowledge of the standards of green agricultural products production, processing, transportation, packaging, and the costs paid by companies, which in turn affects consumers' perceived green value and ultimately enhances consumers' willingness to pay a premium (Jiang et al., 2021). Therefore, the study uses green agricultural products as its research object and conducts three sets of experiments to examine the mechanisms influencing consumers' willingness to pay a premium for green agricultural products and the mediating role played by green perceived value, to provide ideas for governments and enterprizes to promote green consumption and alleviate environmental problems. ...
Green food has exceptional impacts in addressing food safety and environmental challenges. However, consumers' perception of green food is not substantial, which results in a decline in consumption intention. Since advertising appeals can play a bridging role in resolving information asymmetry. This study is based on self-construal theory, chooses green agricultural products images and text as experimental stimuli, and analyzes the interaction and influence mechanism between advertising appeals and consumers' willingness to pay a premium for green agricultural products through three sets of experimental studies. The findings demonstrate that self-construal and green agricultural product advertising appeals interact to influence consumers' willingness to pay a premium for green agricultural products. Green perceived value is more strongly influenced by matching dependent self-construal and green advertising appeals than non-green advertising appeals. Green perceived value plays a full mediating role in this interactive effect. Green agricultural products companies should adopt different advertising strategies according to the various categories of consumers to enhance consumers' green perceived value and increase the willingness to pay a premium.
