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 retailerâs 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 consumerâs 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 itemâs choice probability, this effect is canceled out when higher-priced â suspicious â items are suggested. Overall, these results indicate that retailers have an interest in pursuing open and convenience-oriented stock-out policies.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Maastricht University in its series Open Access publications from Maastricht University with number urn:nbn:nl:ui:27-19522.
Date of creation: 2006
Date of revision:
Publication status: Published in Journal of retailing (2006) v.82, p.215-228
Contact details of provider:
Web page: http://www.maastrichtuniversity.nl/web/Home.htm
Other versions of this item:
- Breugelmans E. & Campo K. & Gijsbrechts E., 2005. "Opportunities for active stock-out management in online stores: The impact of the stock-out policy on online stock-out reactions," Working Papers 2005005, University of Antwerp, Faculty of Applied Economics.
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Dhar, Ravi, 1997. " Consumer Preference for a No-Choice Option," Journal of Consumer Research, University of Chicago Press, vol. 24(2), pages 215-31, September.
- Kamel Jedidi & Z. John Zhang, 2002. "Augmenting Conjoint Analysis to Estimate Consumer Reservation Price," Management Science, INFORMS, vol. 48(10), pages 1350-1368, October.
- Garrett van Ryzin & Siddharth Mahajan, 1999. "On the Relationship Between Inventory Costs and Variety Benefits in Retail Assortments," Management Science, INFORMS, vol. 45(11), pages 1496-1509, November.
- Gavan J. Fitzsimons & Donald R. Lehmann, 2004. "Reactance to Recommendations: When Unsolicited Advice Yields Contrary Responses," Marketing Science, INFORMS, vol. 23(1), pages 82-94, September.
- Rohm, Andrew J. & Swaminathan, Vanitha, 2004. "A typology of online shoppers based on shopping motivations," Journal of Business Research, Elsevier, vol. 57(7), pages 748-757, July.
- Jianan Wu & Arvind Rangaswamy, 2003. "A Fuzzy Set Model of Search and Consideration with an Application to an Online Market," Marketing Science, INFORMS, vol. 22(3), pages 411-434, March.
- Bronnenberg, Bart J. & Vanhonacker, Wilfried R., 1996. "Limited choice sets, local price response and implied measures of price competition," Open Access publications from Maastricht University urn:nbn:nl:ui:27-6207, Maastricht University.
- Penn, Jerrod & Matopoulos, Aristides & House, Lisa, 2010. "Response to Out of Stock Produce and its Underlying Economic Considerations," 2010 Annual Meeting, February 6-9, 2010, Orlando, Florida 56487, Southern Agricultural Economics Association.
- Nicole Wiebach & Jana L. Diels, 2011. "The impact of context and promotion on consumer responses and preferences in out-of-stock situations," SFB 649 Discussion Papers SFB649DP2011-050, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
- Stavrulaki, Euthemia, 2011. "Inventory decisions for substitutable products with stock-dependent demand," International Journal of Production Economics, Elsevier, vol. 129(1), pages 65-78, January.
- Breugelmans, Els & Campo, Katia, 2008. "Can in-store displays improve category sales and brand market share in online stores? A study on the overall effectiveness and differences between display types in an online FMCG context," Open Access publications from Katholieke Universiteit Leuven urn:hdl:123456789/202226, Katholieke Universiteit Leuven.
- Rosato, Antonio, 2013. "Selling Substitute Goods to Loss-Averse Consumers: Limited Availability, Bargains and Rip-offs," MPRA Paper 47168, University Library of Munich, Germany.
- Breugelmans, Els & Campo, Katia, 2008. "Can in-store displays improve category sales and brand market share in online stores? A study on the overall effectiveness and differences between display types in an online FMCG context," Research Memoranda 035, Maastricht : METEOR, Maastricht Research School of Economics of Technology and Organization.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (J.Odekerken).
If references are entirely missing, you can add them using this form.