Do local consumers behave differently from visitors? An exploratory study in online group buying

Abstract

Abstract With the rapid increase in Groupon-like online daily deals, the behavior of consumers within online group buying has become a popular research topic. In addition, the increase of smart phone group buying has led merchants to consider increasing numbers of visitors beyond local consumers. The effects of the period, price, discount rate, and product category on sales are examined in the context of local consumers and visitors purchasing restaurant coupons in the group-buying electronic marketplace. Using linear and non-linear regressions and conjoint analysis as method, the actual transactional data sets of Dianping.com—one of Asia’s largest online group-buying businesses—is studied. The results show that there is a clear discrepancy between the preferences of the two consumer groups. Local consumers tend to think highly of discounts, while visitors are likely to care more about the product category. In addition, the behavior of the two groups differs in terms of product attribute selections. The findings could be useful to businesses in terms of understanding consumers’ purchasing and product designs.