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Publications
Publications
  • May–June 2023
  • Article
  • Operations Research

Need for Speed: The Impact of In-Process Delays on Customer Behavior in Online Retail

By: Santiago Gallino, Nil Karacaoglu and Antonio Moreno
  • | Pages:19
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Abstract

The impact of delays has been widely studied in various offline services. The focus of this study is online services, and we explore the impact of in-process delays—measured by website speed—on customer behavior. We leverage novel retail and website speed data to investigate how delays impact online sales and how customer sensitivity to in-process delays varies across the different stages of a customer’s shopping journey. We estimate sizable adverse effects of website slowdowns on online sales. Using threshold regression models, we show that customers exhibit diminishing sensitivity to increases in website slowdowns. Our results suggest that waiting times affect customer abandonment differently at different stages of the shopping journey. Customers are more sensitive to slowdowns at the checkout stage. Our findings have implications for website design decisions such as improving website speed at the checkout stage, selecting third-party content providers, and customizing the design of mobile and desktop channels. The paper’s results are especially relevant in the current regulatory environment with ongoing policy debates about net neutrality.

Keywords

Online Retail; Quasi-experiments; Abandonment; Synthetic Control; E-commerce; Internet and the Web; Consumer Behavior; Policy; Retail Industry

Citation

Gallino, Santiago, Nil Karacaoglu, and Antonio Moreno. "Need for Speed: The Impact of In-Process Delays on Customer Behavior in Online Retail." Operations Research 71, no. 3 (May–June 2023): 876–894.
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About The Author

Antonio Moreno

Technology and Operations Management
→More Publications

More from the Authors

    • 2023
    • Faculty Research

    Operational Consequences of Customer Interaction Design: Evidence From Last-Mile Delivery Services

    By: Natalie Epstein, Santiago Gallino and Antonio Moreno
    • March 2023 (Revised August 2023)
    • Faculty Research

    Majid Al Futaim: Adapting the Shopping Mall to the Digital Era

    By: Antonio Moreno and Gamze Yucaoglu
    • March 2023
    • Faculty Research

    Mirakl: Growing The Marketplace Economy

    By: Antonio Moreno, Santiago Gallino and Emilie Billaud
More from the Authors
  • Operational Consequences of Customer Interaction Design: Evidence From Last-Mile Delivery Services By: Natalie Epstein, Santiago Gallino and Antonio Moreno
  • Majid Al Futaim: Adapting the Shopping Mall to the Digital Era By: Antonio Moreno and Gamze Yucaoglu
  • Mirakl: Growing The Marketplace Economy By: Antonio Moreno, Santiago Gallino and Emilie Billaud
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