Abstract
Cashback shopping has proliferated in the modern retailing landscape. Intuitive thinking may imply that cashback payment drives shoppers to patronize cashback sites; however, this research provides a counterintuitive explanation. Using a field study and a lab experiment, this research demonstrates that cashback (vs. regular) shopping increases online shoppers’ time/effort saving perceptions, enlarges their monetary saving perceptions, and the time/effort and monetary saving perceptions in turn, boost their online expenditure and shopping frequency. This work reveals that cashback shopping removes the cost of time and the cost of money in a price search and thus represents a more advanced shopping model that allows consumers to enjoy the shopping journey. Based on the findings, online retailers should consider integrating price search functions in their website design and emphasizing time-saving rather than money-saving in their marketing communications.
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