| 
| Free Newsletters
| Free Newsletters Featured Videos
Does Loss-Leader Pricing Work in Online Shopping Malls?
By Kim, Ji-Young
Publication: International Journal of Management Science
Date: Thursday, December 1 2005
Publication: International Journal of Management Science
Date: Thursday, December 1 2005
HEADNOTE
for years. One, loss-leader pricing, is a type of promotional pricing in which stores sell well known products below their marginal cost, inorder to attract customers and induce them to purchase more goods through impulse buying. This strategy is based on the expectation that customers will factor transaction costs into their purchasing decisions. However, its application to online malls fails to recognize that transaction costs are lower online, and that customers will behave differently as a result. Our study predicts that loss-leader pricing will not work online because online malls entail lower searching and moving costs than offline malls. The study examines the effectiveness of loss-leader pricing with empirical data from a survey as well as log data from a Korean online shopping mall. The results show that while loss-leader pricing does attract customers to online shopping malls, it encourages cherry-picking rather than impulse purchases of regular-price goods.
ABSTRACT
As online shopping malls have emerged as a substantial shopping channel, they have used various sales promotion strategies to acquire new customers. Most of these strategies have been applied by offline malls
In addition, make sure to read these articles:
- ONLINE SHOPPERS THIS HOLIDAY SEASON WILL FIND...
- (R)etailing: Revolution or evolution?
- UPS Keeps Online Retailers Clicking.
- WHAT E-COMMERCE BUYERS REALLY WANT.
- WHAT E-COMMERCE BUYERS REALLY WANT
- Online Malls Prosper
- Getting the most out of the Internet
- Shopping for Apparel Online Gains Popularity...
- Ashkenazy and Cameron to invest $1 billion in...
- are you web ready?
- General Growth Properties Inc., Chicago.
- Online holiday shopping soars
- Survey Predicts Consumer Spending Up This Holiday...
- Huey/Paprocki Promotes CBL Shopping Malls
- In India the Future of Retail Growth is Strong...
NEW YORK - Online shoppers should be pleased to know that customer service -- both online and offline -- is improving at most of the ......
INTRODUCTION (R)etailing, or online retailing, continues to generate debate, excitement and uncertainty. The converted see it offering a new business model which will revolutionise the ......
For 2006, UPS Serves 20 of Top 25 E-Retailers ATLANTA -- As more and more consumers flock to the Web to purchase holiday gifts, the ......
In the rush to erect storefronts on every corner of the Web, a lot of e-merchants often neglect a fundamental question: Why would anyone shop ......
In the rush to erect storefronts on every corner of the Web, a lot of e-merchants often neglect a fundamental question: Why would anyone shop ......
Holiday sales at e-tailers, as you know, were abysmal. But did you know that sales at online malls skyrocketed last December? A survey The Yankee ......
HEADNOTE This book shows librarians the best ways to put the Web to practical use When the first edition of The Cybrarian 's Manual was ......
Business/Internet & Retail Editors COLUMBUS, Ohio--(BUSINESS WIRE)--July 10, 2000 The future looks promising for online retailers that feature clothing on their sites. A recent survey ......
Ashkenazy Acquisition Corporation and the Cameron Group L.L.C. have formed a joint venture, Ashkenazy Investment Company L.L.C., to acquire $1 billion in regional shopping malls ......
BY THE EDITORS Business strategies to ensure e-commerce solutions and increase online profits THE OPPORTUNITY TO GENERATE E-COMMERCE revenues has enticed many companies to set ......
The nations second largest self-administered regional mall real estate investment trust (REIT) spent the past year battling a tightening of consumer purse strings and the ......
Online shopping in the U.S. increased by 25 percent, to $23.2 billion, during the holiday season. Almost every category posted increases according to the latest ......
The 2006 holiday shopping season looks promising for retailers, according to the recent 2006 Consumer Holiday Shopping survey.
Huey/Paprocki is set to launch its latest work for CBL Properties that includes three television commercials, the shop said. The independent Atlanta shop won the ......
DUBLIN, Ireland -- Research and Markets (http://www.researchandmarkets.com/reports/c34145) has announced the addition of Indian Organized Retail Industry (2005-2007) to their offering. India represents an economic ......
Email
Digg It
del.icio.us
Related Resources
Site Map | Contact Us | FAQs | About Us | RSS Directory | Sign Up for Free Newsletters | Disclosure Policy
Media Kit
Copyright © 1999 - 2009 AllBusiness.com, Inc. All rights reserved.
No part of this content or the data or information included therein may be reproduced,
republished or redistributed without the prior written consent of AllBusiness.com.
Use of this site is governed by our Copyright and Intellectual Property Policy, Terms of Use Agreement and Privacy Policy.
© Copyright KORMS Dec 2005
Provided by ProQuest, LLC. All rights Reserved.
You may not repost, republish, reproduce, package and/or redistribute the content of this page,
in whole or in part, without the written permission of the copyright holder.
Provided by ProQuest, LLC. All rights Reserved.
You may not repost, republish, reproduce, package and/or redistribute the content of this page,
in whole or in part, without the written permission of the copyright holder.
Get In-Depth Company Information from Hoover's | Buy a D&B Credit Report | What is in Your Company's D&B Credit Report?
Online Business Database | Online Business Information | Sales and Marketing Solutions | Business Mailing Lists | Company Profiles
Online Business Database | Online Business Information | Sales and Marketing Solutions | Business Mailing Lists | Company Profiles
Information and opinions on AllBusiness.com solely represent the thoughts and opinions of the authors and are not endorsed by, or reflect the beliefs of,
AllBusiness.com, its parent company D&B, and its affiliates.
AllBusiness.com, its parent company D&B, and its affiliates.
