Location, location … mailing location? The impact of address as a signal

Abstract

Recently, service providers have begun offering an innovative option for consumers seeking to rent an address. While the traditional option was for a post office box (e.g., PO Box 203, Chicago, IL 60654), the new option features a real street address with a unique suite number (e.g., 301 West Grand Avenue, Suite 203, Chicago, IL 60654). Service providers claim that addresses affect consumer perceptions of credibility and professionalism; however, these arguments have never been substantiated. Therefore, this research aims to examine the relationship between addresses and consumer evaluations of small businesses. Across a series of five experiments, we find evidence in support of the service providers’ claims and apply signaling theory to show why consumers evaluate a small business with a street and suite address more favorably.