Consumer informedness and diverse consumer purchasing behaviors: Traditional mass-market, trading down, and trading out into the long tail

Abstract

As truly informed consumers are increasingly able to find exactly what they want and willing to pay premium prices to obtain products with perfect fit for them, companies have responded with new product portfolio strategies and new pricing strategies, based on the concepts of resonance marketing and hyperdifferentiation. This is not just consumers’ pursuit of products that are better, but rather better for them. It is not trading up, but rather trading out. In this paper we offer a more complete explanation of changes in consumer behavior, based on consumers’ new-found informedness, and an understanding of consumers’ pursuit of products that truly meet their individual wants and needs, cravings and longings. This paper also contributes to a deeper understanding of how online reviews are linked to sales. Recent empirical studies suggest that consumers use information in different ways in different shopping experiences, and that consumers’ purchasing behavior varies across different online shopping experiences; consequently, the best predictors of the success of different online products will therefore vary depending on what consumers are buying and why and how they are buying it.