Influence of consumer online resale awareness on purchase decisions: a mental accounting perspective

Abstract

Purpose – Consumer online resale is becoming an increasingly common method of both buying and selling goods. When an item can be easily resold online, consumers' subjective estimation of the value of that item changes in complex ways based on consumption cost and resale return. This in turn can affect consumers' decisions to purchase new products. The authors aim to apply the principles of mental accounting to investigate how consumers' economic psychology associated with buying a new product is affected when an awareness of the possibility of online resale is aroused. Design/methodology/approach – Three studies with between-subjects designs were conducted online to examine the effects of consumer awareness of a resaleable item on purchase intention of a new item under different situations. Findings – The results indicate that: consumers' awareness of the resale value of an already possessed product can influence their decision to purchase a new product; and when the product to be resold is the same type as the desired new item (e.g. an old idle mobile phone and a new mobile phone), the influence of resale awareness on purchase intention is greater than when the two items are distinct types but share similar functions and therefore could be categorized in the same mental account in terms of budget planning (e.g. an old idle digital camera and a new mobile phone) and when the short-used new product to be resold is exactly the same one to be purchased (e.g. buy and resell the same new mobile phone shortly after purchase). Research limitations/implications – The participants were all from a single Taiwanese online community. More and a greater variety of participants (e.g. both online and offline consumers, even those from traditional secondhand markets) should be included in future studies to gain a better understanding of consumer purchasing and resale behavior. Although the authors' studies are relatively theory-driven, the findings might be subject to cultural difference in the online resale environment. Practical implications – Consumers prefer to dispose of items in their homes and that this elevates the purchase intention for new products. Thus, marketers should look favorably upon and implement strategies to exploit secondary markets. Originality/value – By notifying consumers of the future chance to resell a good, the awareness and expectation for an online resale could be prompted, which in turn enhances the intention to purchase a new good. Therefore, the authors suggest that online resale awareness and expectation are important factors affecting consumers' purchasing and reselling behaviors.