Abstract
This study investigates whether the Middle East Respiratory Syndrome (MERS) outbreak in Korea affected online and offline retail sales and determines the presence of a substitution or delay effect between the two. We analyze the monthly retail sales of electronic goods, semi-luxury goods, and groceries using an autoregressive integrated moving average (ARIMA) model with intervention. The findings are as follows. First, offline sales of electronic goods declined by 7.9%, while online sales increased by 7.03%, indicating that these markets can act as substitutes. Second, the offline sales of semi-luxury goods decreased for two months, while online sales remained the same, indicating that there can be a delay effect in the offline market. Finally, despite the slight increase in online sales and the moderate decrease in offline sales, the MERS outbreak did not have a statistically significant effect on grocery sales. Our research findings imply that stakeholders such as the government and retail provided useful information on how to deal with the unexpected outbreak
Highlights
The internet as a channel for electronic marketing has characteristics that are distinct from traditional physical markets [1]
Using the autocorrection function (ACF), partial autocorrelation function (PACF), and portmanteau test, we confirmed that the final mPoAdCeFl,ianncdlupdoirntmg athnteeainutetersvt.enFutirothneirs, uaspipngrotpheriaAtCe.F, PACF, and portmanteau test, we confirmed that the final model including the intervention is appropriate
Consumers opted for online shopping due to concerns about the Middle East Respiratory Syndrome (MERS) infection. This behavioral change occurred immediately in June in both online and offline markets. These results demonstrated that the MERS outbreak led to a decline in offline sales and an increase in online sales, and indicated the presence of a substitution effect between the online market and the traditional market for electronic goods with the external shock of the MERS epidemic moving customers to the online market (Hypothesis 1)
Summary
The internet as a channel for electronic marketing has characteristics that are distinct from traditional physical markets [1]. Consumers alternate between offline and online shops depending on the characteristics of the products that satisfy their demand [2,3,4] In this environment, the outbreak of the Middle East Respiratory Syndrome (MERS) that occurred in May 2015 in South Korea hit the domestic economy hard [5], bringing considerable changes. The outbreak of the Middle East Respiratory Syndrome (MERS) that occurred in May 2015 in South Korea hit the domestic economy hard [5], bringing considerable changes When infectious diseases such as MERS, Severe Acute Respiratory Syndrome (SARS), and H1N1 (subtype of influenza A virus) spread, people worry about possible infections that can affect their outdoor activities [6,7], and consumer behavior [8,9]. As concerns were mounting over MERS among economic players, there were visible signs of economic slowdown across the nation, including a reduction in demand for tourism, entertainment, leisure, and dining and a shrinking private education industry caused by a temporary shutdown of schools [10]
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
