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To buy or not to buy? Price salience in an online shopping field experiment

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  • Dertwinkel-Kalt, Markus
  • Köster, Mats
  • Sutter, Matthias

Abstract

We examine whether shrouding or partitioning of a surcharge raises demand in online shopping. In a field experiment with more than 34,000 consumers, we find that consumers in the online shop of a cinema initiate a purchase process for a 3D movie more often when the 3D surcharge is shrouded, but they also drop out more often when the overall price is shown at the check-out. In sum, the demand distribution is independent of the price presentation. This result qualifies previous findings on the effectiveness of shrouding surcharges and can be rationalized through low cancellation costs.

Suggested Citation

  • Dertwinkel-Kalt, Markus & Köster, Mats & Sutter, Matthias, 2020. "To buy or not to buy? Price salience in an online shopping field experiment," DICE Discussion Papers 333, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    • Handle: RePEc:zbw:dicedp:333
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    References listed on IDEAS

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    Cited by:

    1. Rhodes, Andrew, 2023. "A Survey on Drip Pricing and Other False Advertising," TSE Working Papers 23-1434, Toulouse School of Economics (TSE).
    2. Johannes Kasinger, 2024. "Shrouded Sin Taxes," Papers 2409.01493, arXiv.org.
    3. Xiaoguang Wang & Tao Lv & Lei Fan, 2022. "New Energy Vehicle Consumer Demand Mining Research Based on Fusion Topic Model: A Case in China," Sustainability, MDPI, vol. 14(6), pages 1-13, March.

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    More about this item

    Keywords

    Salience; Inattention; Shrouding; Price partitioning; Field experiment;
    All these keywords.

    JEL classification:

    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments

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