Research Note—Managing e-Marketplace: A Strategic Analysis of Nonprice Advertising
The e-marketplace has emerged as an important electronic shopping environment that, according to a recent report, may evolve into a dominant force in Internet marketing. We investigate an e-marketplace with online stores offering competing products. We find that featuring is associated with a price premium and serves as a mechanism to mitigate competition among online stores. In essence, featuring facilitates a convenience-price trade-off. Those consumers who find that the cost of searching outweighs the benefit of a lower expected price shop at the featured store where the price is higher on average. We endogenize consumers' decisions on shopping at the featured store or use the search engine to shop at the low-price store and examine the robustness of our results in an -store setting.
Volume (Year): 25 (2006)
Issue (Month): 2 (03-04)
|Contact details of provider:|| Postal: 7240 Parkway Drive, Suite 300, Hanover, MD 21076 USA|
Web page: http://www.informs.org/
More information through EDIRC
References listed on IDEAS
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.:
- Rapoport, Amnon & Amaldoss, Wilfred, 2004. "Mixed-strategy play in single-stage first-price all-pay auctions with symmetric players," Journal of Economic Behavior & Organization, Elsevier, vol. 54(4), pages 585-607, August.
- Mathewson, G Frank & Winter, Ralph A, 1985. "The Economics of Franchise Contracts," Journal of Law and Economics, University of Chicago Press, vol. 28(3), pages 503-26, October.
- Varian, Hal R, 1980. "A Model of Sales," American Economic Review, American Economic Association, vol. 70(4), pages 651-59, September.
- Michael R. Baye & John Morgan, 2001. "Information Gatekeepers on the Internet and the Competitiveness of Homogeneous Product Markets," American Economic Review, American Economic Association, vol. 91(3), pages 454-474, June.
- Steven M. Shugan, 2004. "The Impact of Advancing Technology on Marketing and Academic Research," Marketing Science, INFORMS, vol. 23(4), pages 469-475.
- Peter M. Guadagni & John D. C. Little, 1983. "A Logit Model of Brand Choice Calibrated on Scanner Data," Marketing Science, INFORMS, vol. 2(3), pages 203-238.
- Dudey, Marc, 1990. "Competition by Choice: The Effect of Consumer Search on Firm Location Decisions," American Economic Review, American Economic Association, vol. 80(5), pages 1092-1104, December.
- Fiona Scott Morton & Florian Zettelmeyer & Jorge Silva-Risso, 2001. "Internet Car Retailing," NBER Chapters, in: E-commerce, pages 501-519 National Bureau of Economic Research, Inc.
- Morton, Fiona Scott & Zettelmeyer, Florian & Silva-Risso, Jorge, 2001. "Internet Car Retailing," Journal of Industrial Economics, Wiley Blackwell, vol. 49(4), pages 501-19, December.
- Rapoport, Amnon & Amaldoss, Wilfred, 2000. "Mixed strategies and iterative elimination of strongly dominated strategies: an experimental investigation of states of knowledge," Journal of Economic Behavior & Organization, Elsevier, vol. 42(4), pages 483-521, August.
- Alan L. Montgomery & Shibo Li & Kannan Srinivasan & John C. Liechty, 2004. "Modeling Online Browsing and Path Analysis Using Clickstream Data," Marketing Science, INFORMS, vol. 23(4), pages 579-595, November.
- Jagmohan Raju & Z. John Zhang, 2005. "Channel Coordination in the Presence of a Dominant Retailer," Marketing Science, INFORMS, vol. 24(2), pages 254-262, February.
- Wilfred Amaldoss & Sanjay Jain, 2002. "David vs. Goliath: An Analysis of Asymmetric Mixed-Strategy Games and Experimental Evidence," Management Science, INFORMS, vol. 48(8), pages 972-991, August.
- Birger Wernerfelt, 1994. "Selling Formats for Search Goods," Marketing Science, INFORMS, vol. 13(3), pages 298-309.
- Allenby, Greg M & Lenk, Peter J, 1995. "Reassessing Brand Loyalty, Price Sensitivity, and Merchandising Effects on Consumer Brand Choice," Journal of Business & Economic Statistics, American Statistical Association, vol. 13(3), pages 281-89, July.
- Rajiv Lal, 1990. "Improving Channel Coordination Through Franchising," Marketing Science, INFORMS, vol. 9(4), pages 299-318.
- Eric J. Johnson & Wendy W. Moe & Peter S. Fader & Steven Bellman & Gerald L. Lohse, 2004. "On the Depth and Dynamics of Online Search Behavior," Management Science, INFORMS, vol. 50(3), pages 299-308, March.
- Jeffrey H. Fischer & Joseph E. Harrington Jr., 1996. "Product Variety and Firm Agglomeration," RAND Journal of Economics, The RAND Corporation, vol. 27(2), pages 281-309, Summer.
- Narasimhan, Chakravarthi, 1988. "Competitive Promotional Strategies," The Journal of Business, University of Chicago Press, vol. 61(4), pages 427-49, October.
- Christine Moorman & Rex Du & Carl F. Mela, 2005. "The Effect of Standardized Information on Firm Survival and Marketing Strategies," Marketing Science, INFORMS, vol. 24(2), pages 263-274, September.
When requesting a correction, please mention this item's handle: RePEc:inm:ormksc:v:25:y:2006:i:2:p:175-187. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mirko Janc)
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 references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.