Abstract
Comparison-shopping applications are widespread and have been the subject of considerable research and development. There has also been widespread recognition that people are predictably irrational when making shopping decisions. In this work, we combine these two facts to propose a new type of predicable irrational behavior that has important implications for comparison-shopping applications that now utilize crowdsourcing to increase the information provided about sellers in these electronic marketplaces. In a series of three studies we demonstrate that, even after controlling for relative and absolute savings, the number of items in a shopping trip is an important consideration in the decision to make a trip to more than one store. This is true of both actual trips in physical shopping in the real world, and virtual trips to other vendors in online shopping. We term this effect quantity bias.
Highlights
The growth of the Internet and mobile services has led to increased opportunity for consumers to rely on information technology (IT) enabled shopping [1,2,3,4,5]
Prior research has demonstrated that people are predictably irrational in that they attend to the relative cost savings rather than only attending to the absolute cost savings when making a decision to travel to a store
We add to the literature on predicable irrationality in the decision to travel to another store by proposing that the number of items will be a significant decision variable for people making a decision about traveling to a store
Summary
The growth of the Internet and mobile services has led to increased opportunity for consumers to rely on information technology (IT) enabled shopping [1,2,3,4,5]. The key theoretical addition we provide is to propose that in addition to the well-known biases discussed above, in multi-item basket shopping there will be a quantity bias such that shoppers will prefer to go to a second store more if there are more items to purchase at the second store even when the relative and absolute savings are the same. This follows directly from Thaler’s work on hedonic editing [13, 14]. We predict: H3: To complete the purchase of a multi-item list, the number of items that are to be purchased from a second store will be positively correlated with the decision to go to the second store. (Quantity Hypothesis)
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