More from these Authors

• Article | Journal of Marketing Research (JMR) | December 2019

  The Impact of Increasing Search Frictions on Online Shopping Behavior: Evidence from a Field Experiment

  Donald Ngwe, Kris J. Ferreira and Thales Teixeira

  Many online stores are designed such that shoppers can easily access any available discounted products. We propose that deliberately increasing search frictions by placing small obstacles to locating discounted items can improve online retailers’ margins and even increase conversion. We demonstrate using a simple theoretical framework that inducing consumers to inspect higher-priced items first may simultaneously increase the average price of items sold and the overall expected purchase probability by inducing consumers to search more products. We test and confirm these predictions in a series of field experiments conducted with a dominant online fashion and apparel retailer. Furthermore, using information in historical transaction data about each consumer, we demonstrate that price-sensitive shoppers are more likely to incur search costs to locate discounted items. Our results show that increasing search frictions can be used as a self-selecting price discrimination tool to match high discounts with price-sensitive consumers and full-priced offerings with price-insensitive consumers.

  Keywords: e-commerce; online retailing; friction; effor; search costs; price discrimination; Marketing; Consumer Behavior; Strategy; Price; Retail Industry; Fashion Industry;

  Citation:

  Ngwe, Donald, Kris J. Ferreira, and Thales Teixeira. "The Impact of Increasing Search Frictions on Online Shopping Behavior: Evidence from a Field Experiment." Journal of Marketing Research (JMR) 56, no. 6 (December 2019): 944–959.  View Details

  CiteView DetailsFind at Harvard

  Related

• Case | HBS Case Collection | June 2019

  Airbnb, Etsy, Uber: Expanding from One to Many Millions of Customers

  By 2019, two-sided online platforms (or marketplaces) were among the highest-growing internet startups around. These marketplaces sought to match suppliers of assets for rent, physical products, or services with customers demanding them. Among the most notable two-sided platforms that quickly reached millions of customers were Airbnb, Etsy, and Uber. They offered short-term property rentals, handcrafted goods, and car rides, respectively. As two-sided markets grew past the 1 million customer mark, challenges of typical large businesses appeared. Among the challenges facing Airbnb, Etsy, and Uber were maintaining the fast pace of customer acquisition, reducing customer retention problems, and avoiding regulatory issues. How did these platforms balance their fast growth and massive size with so little time to adapt to ever mounting challenges? How did they adapt and change their customer acquisition tactics to grow from 1 million to many millions of customers so quickly? This is the third and final instalment of the Airbnb, Etsy, Uber trilogy.

  Keywords: Airbnb; Etsy; Uber; Growth hacking; Two-Sided Markets; digital marketing; customer acquisition; Two-Sided Platforms; Growth Management; Marketing Strategy; Customers; Acquisition; Organizational Change and Adaptation;

  Citation:

  Teixeira, Thales S. "Airbnb, Etsy, Uber: Expanding from One to Many Millions of Customers." Harvard Business School Case 519-087, June 2019.  View Details

  CiteView DetailsEducatorsPurchase

  Related

• Case | HBS Case Collection | September 2015 (Revised May 2019)

  Managing Consumer Touchpoints at Nissan Japan

  Thales Teixeira, Nobuo Sato and Akiko Kanno

  In 2015, Nissan was third place in the Japanese auto market, behind Toyota and Honda. The challenge of increasing market share was that 80% of car shoppers who were non-Nissan owners did not consider Nissan during their purchase process. This process involved three main consumer touchpoints: mass media advertising, internet auto websites, and the physical dealerships. In the last five years, the importance of the dealers in influencing car sales had greatly diminished as consumers researched and chose which make and brand of car to buy online, going to the dealer only to negotiate price, purchase, and receive the car. Given this trend, how should Nissan's top marketer make changes in how Nissan manages these three key consumer touchpoints? And how to better integrate them to maximize sales.

  Keywords: Nissan; Automobiles; cars; touch points; digital marketing; Internet; Web Sites; Marketing Channels; Advertising; Auto Industry; Japan;

  Citation:

  Teixeira, Thales, Nobuo Sato, and Akiko Kanno. "Managing Consumer Touchpoints at Nissan Japan." Harvard Business School Case 516-035, September 2015. (Revised May 2019.)  View Details

  CiteView DetailsEducatorsPurchase

  Related