The effects of product digitalization and price dispersion on search intentions in offline versus online settings: the mediating effects of perceived risks

Abstract

PurposeThe purpose of this paper is to examine how a product‐related variable like digitalization and a market‐related variable like price dispersion might differentially influence consumer search intentions across offline versus online shopping interfaces, and how this relationship might be mediated by consumers' perceived risks. Prior research findings are extended and examines how the perceived risk – search intention relationship might be different in online contexts. The distinction is drawn between perceived performance risk versus perceived transaction risk and examines how each of these risks would differentially influence search intentions across the two shopping interfaces (offline versus online).Design/methodology/approachTwo experimental studies are conducted.FindingsStudy 1 shows that under conditions when perceived performance risks are enhanced, such as for non‐digitalized (versus digitalized) products, consumers' search intentions are enhanced, with the effects getting magnified in online shopping interfaces. In Study 2, the effects of a condition are examined when instead of performance risks, transaction risks are enhanced by a market‐related variable – price dispersion. The results of Study 2 show that when there is higher price dispersion in the marketplace, in the offline environment, participants have higher search intentions, while in the online environment, participants have lower search intentions. In addition, the effects of price dispersion on search intention in the online environment are mediated by perceived transaction risk.Originality/valueLimitations of the studies suggest that future research may extend these findings to include non‐student samples, differential search costs, customer‐related factors like trust and involvement, other types of risks like social and psychological, social networking sites, and multichannel search behaviors.