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An Empirical Study on Factors Affecting Price Sensitivity and Choice of Internet Bookstores  

Oh, Jeong-Eun (Entrue Consulting Partners, LG CNS)
Lee, Seung-Chang (College of Business and Economics, Yonsei University)
Lee, Ho-Geun (Department of Business Administration, College of Business and Economics, Yonsei University)
Publication Information
Information Systems Review / v.4, no.2, 2002 , pp. 133-153 More about this Journal
Abstract
Internet lowers the search cost to acquire information about products and sellers price information. Because consumers can easily compare prices among different Internet retailers, the price competition among merchants in Internet has been intensified. For online retailers, it is important to differentiate their sites from competitors based upon services rather than prices. This study investigates which factors influence on consumers price sensitivity in Internet book markets and examines whether consumers price sensitivity has any effect on the type of preferred Internet bookstore (hybrid or pure online book stores). Survey is conducted to empirically investigate the relationship among the various consumer attitudes and price sensitivity. The result shows that price search and price importance have effect on the choice of Internet bookstore. Consumers with higher price sensitivity preferred to purchase books from pure Internet bookstores rather than hybrid (click-and-mortar) bookstores. This study provides an exploratory framework that tries to understand consumer behavior about price sensitivity that might provide some marketing implications to lessen the price competition of Internet retailers.
Keywords
Internet Shopping Mall; Internet Bookstore; Price Sensitivity; Price Search; Price Importance;
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