Opportunities for active stock-out management in online stores: The impact of the stock-out policy on online stock-out reactions
AbstractThis paper investigates the impact of an online retailer’s stock-out policy on purchase incidence and choice. We make a distinction between three policies: (1) stock-outs are immediately visible and there are no suggestions, (2) stock-outs are only visible after clicking and (3) a replacement item is suggested for each stock-out product. Results from an extensive and realistic online grocery shopping experiment reveal that the adopted stock-out policy has a significant impact on both decisions. First, making stock-outs not immediately visible creates confusion and intensifies the consumer’s loss experience, thereby reducing the tendency to buy in the category. Second, while suggesting a replacement item normally leads to a substantial increase in the item’s choice probability, this effect is canceled out when higher-priced – suspicious – items are suggested. Overall, these results indicate that retailers have an interest in pursuing open and convenience-oriented stock-out policies.
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Bibliographic InfoPaper provided by University of Antwerp, Faculty of Applied Economics in its series Working Papers with number 2005005.
Length: 40 pages
Date of creation: Feb 2005
Date of revision:
Other versions of this item:
- Breugelmans, Els & Campo, Katia & Gijsbrechts, Els, 2006. "Opportunities for active stock-out management in online stores: The impact of the stock-out policy on online stock-out reactions," Open Access publications from Maastricht University urn:nbn:nl:ui:27-19522, Maastricht University.
- NEP-ACC-2005-02-13 (Accounting & Auditing)
- NEP-ALL-2005-02-13 (All new papers)
- NEP-BEC-2005-02-13 (Business Economics)
- NEP-DCM-2005-02-13 (Discrete Choice Models)
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