Heuristic or systematic? Effects of information cues on dynamics of consumers conversion in live streaming e-commerce

Live streaming e-commerce is becoming a mainstream marketing channel for firms, which has aroused great interest among practitioners and researchers. Although improving consumers’ conversion rate is regarded as the key to the success of live streaming e-commerce, few studies have noticed the dynamic nature of consumers’ conversion state, i.e., the consecutive transition of conversion state of consumers during the consecutive product-selling segments. To fill these research gaps, this paper investigates the effects of heuristic cues and systematic cues from streamer on the dynamics of consumers’ conversion state based on the dual processing theory. We adopt a data-driven approach to make use of hidden Markov model to identify unobserved consumers’ conversion state from observed behavior data. Empirical study is conducted by using 6,825 product live segments collected from Douyin e-commerce platform. The findings indicate that both heuristic cues and systematic cues have positive effects on escalating the conversion state of consumers and the previous conversion state of consumers moderates the effects. These findings provide great managerial implications for practitioners in customizing their marketing strategy in live streaming e-commerce.