The Impact of E-commerce and Social Media Personalized Recommendations on Consumer Behavior in the Digital Era from the Perspective of Behavioral Economics

Abstract

With the digitization of consumption methods, consumers' consumption psychology will also be affected, thereby affecting their final consumption behavior. E-commerce and personalized recommendations on social media in the digital era are two important influencing factors. Therefore, studying how these two factors affect consumers' consumption concepts and behaviors through behavioral economics has theoretical and practical significance. Existing research mostly analyzes consumers' choices when making online purchases from the perspective of behavioral economics, or how a single social media platform affects consumer behavior. This article aims to combine the two and analyze through behavioral economics how shopping platforms and social media platforms affect consumer psychology and thus consumer behavior in the information age. Summarize existing research results to determine how e-commerce shopping platforms and social media affect consumption outcomes, and explain the reasons from a behavioral economics perspective. Qualitative research is conducted through questionnaire data analysis and literature review. From the perspective of behavioral economics, it is found that most people hold a positive attitude towards personalized recommendation systems, but consumers are more interested in the gap between the recommended products and their psychological expectations and the effects it makes to improve shopping efficiency and protect one's privacy. Therefore, these factors have a significant impact on consumer psychology. In order for e-commerce platforms to increase their revenue, they need to improve in these aspects and establish trust with consumers.