IDEAS home Printed from https://ideas.repec.org/a/eee/joreco/v52y2020ics096969891930219x.html
   My bibliography  Save this article

The effect of credit card versus mobile payment on convenience and consumers’ willingness to pay

Author

Listed:
  • Boden, Joe
  • Maier, Erik
  • Wilken, Robert

Abstract

Extant literature on payment methods has focused on comparing cash and credit cards and emphasized the lower pain of paying (i.e., fewer negative consequences) for the latter. This finding, in turn, explains why consumers express higher willingness to pay (WTP) when paying with credit cards. The current study introduces mobile technology as a new payment method to this literature. Specifically, it highlights convenience as a positive driver of increased WTP for mobile payment. However, for consumers to perceive mobile payment as convenient, a personal adoption (enabled through an existing system in the respective country market) is necessary. A set of three studies across several country markets tests these assumptions empirically. Convenience emerges as a new mediator between mobile payment and increased WTP, contingent on personal adoption. These findings thus extend extant literature on the mechanisms consumers use with different payment methods, and they offer differentiated recommendations regarding payment channels for country managers.

Suggested Citation

  • Boden, Joe & Maier, Erik & Wilken, Robert, 2020. "The effect of credit card versus mobile payment on convenience and consumers’ willingness to pay," Journal of Retailing and Consumer Services, Elsevier, vol. 52(C).
    • Handle: RePEc:eee:joreco:v:52:y:2020:i:c:s096969891930219x
    DOI: 10.1016/j.jretconser.2019.101910
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S096969891930219X
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jretconser.2019.101910?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Manoj Thomas & Kalpesh Kaushik Desai & Satheeshkumar Seenivasan, 2011. "How Credit Card Payments Increase Unhealthy Food Purchases: Visceral Regulation of Vices," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 38(1), pages 126-139.
    2. Erik Maier & Robert Wilken & Florian Dost, 2015. "The double benefits of consumer certainty: combining risk and range effects," Marketing Letters, Springer, vol. 26(4), pages 473-488, December.
    3. Fred D. Davis & Richard P. Bagozzi & Paul R. Warshaw, 1989. "User Acceptance of Computer Technology: A Comparison of Two Theoretical Models," Management Science, INFORMS, vol. 35(8), pages 982-1003, August.
    4. Torsten Bornemann & Christian Homburg, 2011. "Psychological Distance and the Dual Role of Price," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 38(3), pages 490-504.
    5. Sheely, Megan, 2008. "Global Adoption of Convenience Foods," SS-AAEA Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 2008, pages 1-14.
    6. Drazen Prelec & George Loewenstein, 1998. "The Red and the Black: Mental Accounting of Savings and Debt," Marketing Science, INFORMS, vol. 17(1), pages 4-28.
    7. Comin, D. & Hobijn, B., 2004. "Cross-country technology adoption: making the theories face the facts," Journal of Monetary Economics, Elsevier, vol. 51(1), pages 39-83, January.
    8. Falk, Tomas & Kunz, Werner H. & Schepers, Jeroen J.L. & Mrozek, Alexander J., 2016. "How mobile payment influences the overall store price image," Journal of Business Research, Elsevier, vol. 69(7), pages 2417-2423.
    9. Feinberg, Richard A, 1986. "Credit Cards as Spending Facilitating Stimuli: A Conditioning Interpretation," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 13(3), pages 348-356, December.
    10. Rufina Gafeeva & Erik Hoelzl & Holger Roschk, 2018. "What else can your payment card do? Multifunctionality of payment modes can reduce payment transparency," Marketing Letters, Springer, vol. 29(1), pages 61-72, March.
    11. Hirschman, Elizabeth C, 1979. "Differences in Consumer Purchase Behavior by Credit Card Payment System," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 6(1), pages 58-66, June.
    12. Huh, Young Eun & Kim, Sang-Hoon, 2008. "Do early adopters upgrade early? Role of post-adoption behavior in the purchase of next-generation products," Journal of Business Research, Elsevier, vol. 61(1), pages 40-46, January.
    13. Shaw, Norman, 2014. "The mediating influence of trust in the adoption of the mobile wallet," Journal of Retailing and Consumer Services, Elsevier, vol. 21(4), pages 449-459.
    14. de Kerviler, Gwarlann & Demoulin, Nathalie T.M. & Zidda, Pietro, 2016. "Adoption of in-store mobile payment: Are perceived risk and convenience the only drivers?," Journal of Retailing and Consumer Services, Elsevier, vol. 31(C), pages 334-344.
    15. Liao, Ziqi & Shi, Xinping & Wong, Wing-Keung, 2014. "Key determinants of sustainable smartcard payment," Journal of Retailing and Consumer Services, Elsevier, vol. 21(3), pages 306-313.
    16. Angulo-Ruiz, Fernando & Pergelova, Albena & Cheben, Juraj & Angulo-Altamirano, Eladio, 2016. "A cross-country study of marketing effectiveness in high-credence services," Journal of Business Research, Elsevier, vol. 69(9), pages 3636-3644.
    17. Turley, L. W. & Milliman, Ronald E., 2000. "Atmospheric Effects on Shopping Behavior: A Review of the Experimental Evidence," Journal of Business Research, Elsevier, vol. 49(2), pages 193-211, August.
    18. Deepa Chandrasekaran & Gerard J. Tellis, 2008. "Global Takeoff of New Products: Culture, Wealth, or Vanishing Differences?," Marketing Science, INFORMS, vol. 27(5), pages 844-860, 09-10.
    19. Amy Moore & Michael Taylor, 2011. "Time to Cut Up Those Debit Cards? Effect of Payment Mode on Willingness to Spend," Journal of Consumer Policy, Springer, vol. 34(4), pages 415-422, December.
    20. Lee, Jiyoon & Ryu, Min Ho & Lee, Daeho, 2019. "A study on the reciprocal relationship between user perception and retailer perception on platform-based mobile payment service," Journal of Retailing and Consumer Services, Elsevier, vol. 48(C), pages 7-15.
    21. Megan Sheely, 2008. "Global Adoption of Convenience Foods," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 90(5), pages 1356-1365.
    22. Yang, Sha & Markoczy, Livia & Qi, Min, 2007. "Unrealistic optimism in consumer credit card adoption," Journal of Economic Psychology, Elsevier, vol. 28(2), pages 170-185, April.
    23. Belk, Russell W, 1975. "Situational Variables and Consumer Behavior," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 2(3), pages 157-164, December.
    24. Greenacre, Luke & Akbar, Skye, 2019. "The impact of payment method on shopping behaviour among low income consumers," Journal of Retailing and Consumer Services, Elsevier, vol. 47(C), pages 87-93.
    25. Schmidt, Gordon B., 2015. "Fifty Days an MTurk Worker: The Social and Motivational Context for Amazon Mechanical Turk Workers," Industrial and Organizational Psychology, Cambridge University Press, vol. 8(2), pages 165-171, June.
    26. Park, JungKun & Ahn, Jiseon & Thavisay, Toulany & Ren, Tianbao, 2019. "Examining the role of anxiety and social influence in multi-benefits of mobile payment service," Journal of Retailing and Consumer Services, Elsevier, vol. 47(C), pages 140-149.
    27. Gwarlann de Kerviler & Nathalie Demoulin & Pietro Zidda, 2016. "Adoption of in-store mobile payment: Are perceived risk and convenience the only drivers?," Post-Print hal-01526066, HAL.
    28. Peterson, Robert A, 2001. "On the Use of College Students in Social Science Research: Insights from a Second-Order Meta-analysis," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 28(3), pages 450-461, December.
    29. Carow, Kenneth A. & Staten, Michael E., 1999. "Debit, credit, or cash: survey evidence on gasoline purchases," Journal of Economics and Business, Elsevier, vol. 51(5), pages 409-421, September.
    30. Berinsky, Adam J. & Huber, Gregory A. & Lenz, Gabriel S., 2012. "Evaluating Online Labor Markets for Experimental Research: Amazon.com's Mechanical Turk," Political Analysis, Cambridge University Press, vol. 20(3), pages 351-368, July.
    31. Shankar, Venkatesh & Kleijnen, Mirella & Ramanathan, Suresh & Rizley, Ross & Holland, Steve & Morrissey, Shawn, 2016. "Mobile Shopper Marketing: Key Issues, Current Insights, and Future Research Avenues," Journal of Interactive Marketing, Elsevier, vol. 34(C), pages 37-48.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Moghavvemi, Sedigheh & Mei, Tan Xin & Phoong, Seuk Wai & Phoong, Seuk Yen, 2021. "Drivers and barriers of mobile payment adoption: Malaysian merchants' perspective," Journal of Retailing and Consumer Services, Elsevier, vol. 59(C).
    2. Dash, Ganesh & Sharma, Kiran & Yadav, Neha, 2023. "The diffusion of mobile payments: Profiling the adopters and non-adopters, Roger's way," Journal of Retailing and Consumer Services, Elsevier, vol. 71(C).
    3. Liu, Yunxin & Dewitte, Siegfried, 2021. "A replication study of the credit card effect on spending behavior and an extension to mobile payments," Journal of Retailing and Consumer Services, Elsevier, vol. 60(C).
    4. Jean N. Lee & Jonathan Morduch & Saravana Ravindran & Abu S. Shonchoy, 2023. "The Social Meaning of Mobile Money: Willingness to Pay with Mobile Money in Bangladesh," Working Papers 2304, Florida International University, Department of Economics.
    5. M. M. Naeser Seldal & Ellen K. Nyhus, 2022. "Financial Vulnerability, Financial Literacy, and the Use of Digital Payment Technologies," Journal of Consumer Policy, Springer, vol. 45(2), pages 281-306, June.
    6. Jain, Nikunj Kumar & Gajjar, Hasmukh & Shah, Bhavin J., 2021. "Electronic logistics service quality and repurchase intention in e-tailing: Catalytic role of shopping satisfaction, payment options, gender and returning experience," Journal of Retailing and Consumer Services, Elsevier, vol. 59(C).
    7. Adu-Gyamfi, Gibbson & Asamoah, Ama Nyarko & Nketiah, Emmanuel & Obuobi, Bright & Adjei, Mavis & Cudjoe, Dan & Zhu, Bangzhu, 2023. "Reducing waste management challenges: Empirical assessment of waste sorting intention among corporate employees in Ghana," Journal of Retailing and Consumer Services, Elsevier, vol. 72(C).
    8. Yan, Li-Ya & Tan, Garry Wei-Han & Loh, Xiu-Ming & Hew, Jun-Jie & Ooi, Keng-Boon, 2021. "QR code and mobile payment: The disruptive forces in retail," Journal of Retailing and Consumer Services, Elsevier, vol. 58(C).
    9. Mohamed, Abdinur Ali, 2023. "The influence of the mobile money payment on the performance of small and medium enterprises in Somalia," Technological Forecasting and Social Change, Elsevier, vol. 196(C).
    10. Marie-Claire Broekhoff & Carin van der Cruijsen, 2022. "Paying in a blink of an eye: it hurts less, but you spend more," Working Papers 760, DNB.
    11. Batiz-Lazo, Bernardo & Maixe-Altes, J Carles & Peon, David, 2023. "Behavioral drivers of cashless payments in Africa," MPRA Paper 117984, University Library of Munich, Germany.
    12. Mombeuil, Claudel, 2020. "An exploratory investigation of factors affecting and best predicting the renewed adoption of mobile wallets," Journal of Retailing and Consumer Services, Elsevier, vol. 55(C).
    13. Loh, Xiu-Ming & Lee, Voon-Hsien & Leong, Lai-Ying & Aw, Eugene Cheng-Xi & Cham, Tat-Huei & Tang, Yun-Chia & Hew, Jun-Jie, 2023. "Understanding consumers’ resistance to pay with cryptocurrency in the sharing economy: A hybrid SEM-fsQCA approach," Journal of Business Research, Elsevier, vol. 159(C).
    14. Joowon Park & Sachin Banker, 2023. "Bitcoin-denominated prices can reduce preference for vice products," Marketing Letters, Springer, vol. 34(2), pages 309-319, June.
    15. Hamzah, Muhammad Iskandar & Ramli, Faten Aisyah Ahmad & Shaw, Norman, 2023. "The moderating influence of brand image on consumers' adoption of QR-code e-wallets," Journal of Retailing and Consumer Services, Elsevier, vol. 73(C).
    16. Li, Jingping & Zheng, Jin Di, 2023. "Pro-social preferences and risk aversion with different payment methods: Evidence from the laboratory," International Review of Economics & Finance, Elsevier, vol. 87(C), pages 324-337.
    17. Yang, Wei & Vatsa, Puneet & Ma, Wanglin & Zheng, Hongyun, 2023. "Does mobile payment adoption really increase online shopping expenditure in China: A gender-differential analysis," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 99-110.
    18. Mombeuil, Claudel & Uhde, Helena, 2021. "Relative convenience, relative advantage, perceived security, perceived privacy, and continuous use intention of China’s WeChat Pay: A mixed-method two-phase design study," Journal of Retailing and Consumer Services, Elsevier, vol. 59(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Liu, Yunxin & Dewitte, Siegfried, 2021. "A replication study of the credit card effect on spending behavior and an extension to mobile payments," Journal of Retailing and Consumer Services, Elsevier, vol. 60(C).
    2. Yizhao Jiang, 2022. "The Influence of Payment Method: Do Consumers Pay More with Mobile Payment?," Papers 2210.14631, arXiv.org.
    3. Greenacre, Luke & Akbar, Skye, 2019. "The impact of payment method on shopping behaviour among low income consumers," Journal of Retailing and Consumer Services, Elsevier, vol. 47(C), pages 87-93.
    4. Zeballos, Eliana & Mancino, Lisa & Lin, Biing-Hwan, 2020. "Does how you pay influence the share of healthy items that you Buy? Assessing differences in nutritional quality of food purchases by payment type," Food Policy, Elsevier, vol. 92(C).
    5. Falk, Tomas & Kunz, Werner H. & Schepers, Jeroen J.L. & Mrozek, Alexander J., 2016. "How mobile payment influences the overall store price image," Journal of Business Research, Elsevier, vol. 69(7), pages 2417-2423.
    6. Bernadette Kamleitner & Berna Erki, 2013. "Payment method and perceptions of ownership," Marketing Letters, Springer, vol. 24(1), pages 57-69, March.
    7. Zha, Yong & Wang, Yuting & Li, Quan & Yao, Wenying, 2022. "Credit offering strategy and dynamic pricing in the presence of consumer strategic behavior," European Journal of Operational Research, Elsevier, vol. 303(2), pages 753-766.
    8. Marie-Claire Broekhoff & Carin van der Cruijsen, 2022. "Paying in a blink of an eye: it hurts less, but you spend more," Working Papers 760, DNB.
    9. Khan, Jashim & Belk, Russell W. & Craig-Lees, Margaret, 2015. "Measuring consumer perceptions of payment mode," Journal of Economic Psychology, Elsevier, vol. 47(C), pages 34-49.
    10. Verkijika, Silas Formunyuy & Neneh, Brownhilder Ngek, 2021. "Standing up for or against: A text-mining study on the recommendation of mobile payment apps," Journal of Retailing and Consumer Services, Elsevier, vol. 63(C).
    11. Yan, Ruiliang & Cao, Zixia, 2017. "Product returns, asymmetric information, and firm performance," International Journal of Production Economics, Elsevier, vol. 185(C), pages 211-222.
    12. Sharma, Sujeet Kumar & Mangla, Sachin Kumar & Luthra, Sunil & Al-Salti, Zahran, 2018. "Mobile wallet inhibitors: Developing a comprehensive theory using an integrated model," Journal of Retailing and Consumer Services, Elsevier, vol. 45(C), pages 52-63.
    13. Yuyang Zhao & Fernando Bacao, 2021. "How Does the Pandemic Facilitate Mobile Payment? An Investigation on Users’ Perspective under the COVID-19 Pandemic," IJERPH, MDPI, vol. 18(3), pages 1-22, January.
    14. Dalla Costa, Aldo Fortunato & Mollica, Vito & Singh, Abhay, 2021. "Payment methods and the disposition effect: Evidence from Indonesian mutual fund trading," Journal of Behavioral and Experimental Finance, Elsevier, vol. 30(C).
    15. Park, JungKun & Ahn, Jiseon & Thavisay, Toulany & Ren, Tianbao, 2019. "Examining the role of anxiety and social influence in multi-benefits of mobile payment service," Journal of Retailing and Consumer Services, Elsevier, vol. 47(C), pages 140-149.
    16. Sohn, Stefanie, 2017. "A contextual perspective on consumers' perceived usefulness: The case of mobile online shopping," Journal of Retailing and Consumer Services, Elsevier, vol. 38(C), pages 22-33.
    17. Abhipsa Pal & Tejaswini Herath & Rahul De’ & H. Raghav Rao, 2021. "Is the Convenience Worth the Risk? An Investigation of Mobile Payment Usage," Information Systems Frontiers, Springer, vol. 23(4), pages 941-961, August.
    18. Gilbert, Ben & Graff Zivin, Joshua S., 2020. "Dynamic corrective taxes with time-varying salience," Journal of Environmental Economics and Management, Elsevier, vol. 103(C).
    19. Anurag Dugar & Mani Shreshtha & Rishabh Jain, 2014. "Cognitive Dissonance as an Effect of Indulging on Credit," Paradigm, , vol. 18(2), pages 155-166, December.
    20. Dilip Soman & Amar Cheema, 2002. "The Effect of Credit on Spending Decisions: The Role of the Credit Limit and Credibility," Marketing Science, INFORMS, vol. 21(1), pages 32-53, September.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:joreco:v:52:y:2020:i:c:s096969891930219x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.journals.elsevier.com/journal-of-retailing-and-consumer-services .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.