Identification of Differences in Perception of Uncertainty Factors in the Consumer Behavior of Millennials in E-commerce

E-commerce offers huge potential in terms of online sales, but also poses certain risks for consumers and retailers, in particular cybercrimes, hacker attacks, spam, but also a lack of personal interactions and information asymmetries. These risks may lead to consumer uncertainty. This means that consumers feel insecure when buying products online compared with buying the same products in brick-and-mortar stores. This uncertainty when shopping online discourages many consumers from taking part in online transactions. Previous research points to the fact that consumer uncertainty stems from perceived information asymmetries due to hidden information and moral hazard problems. Perceived information asymmetry can be defined as the situation in which the buyer thinks that the seller has a greater amount or quality of information about products, their properties, and ultimately sales practices. Keywords: e-commerce, consumer behaviour, new generation of customers, uncertainty.

Competitive Entry of Information Goods Under Quality Uncertainty

When confronted with a new product, consumers often find it difficult to predict how it will perform, and such uncertainty reduces consumers’ willingness to adopt the product. In this paper, we consider a market whereby consumers decide when and which product to buy, given that they know the product quality of the incumbent but are uncertain about that of the entrant. We investigate how consumer uncertainty about product quality affects firms’ behavior-based pricing and customer acquisition and retention dynamics. Using a two-period vertical model, we find that, under high-end encroachment, an increase in consumer uncertainty reduces the entrant’s profit and hurts the incumbent’s profit when the quality differential between the products is relatively small, whereas, under low-end encroachment, increasing uncertainty not only benefits the incumbent but also can favor the entrant. An important implication for entrants is that the marketing activities, which aim to reduce consumer uncertainty about product functionalities, may fail to improve profitability. We also find that the entrant lowers the price for uninformed customers and raises the price for repeat buyers under high-end encroachment but lowers the price for all customers under low-end encroachment. We further examine the subsidy strategy and show that, when the entrant’s product has a significant quality advantage and consumer uncertainty is high but not very high, the optimal strategy for the entrant is to acquire all consumers who do not buy from the incumbent by providing subsidies and to drop the low-valuation customers by means of a high price after their uncertainty is resolved.

Do online reviews have different effects on consumers’ sampling behaviour across product types? Evidence from the software industry

Previous research shows that online reviews may have different effects for search goods and experience goods. However, as a typical type of experience goods, software can be further divided into different categories based on product characteristics. Little research has been conducted regarding the different effects of online reviews for different types of software. Furthermore, to offer free samples is another common practice of software firms to alleviate consumer uncertainty prior to purchase. To fill the corresponding research gap, this research focuses on the interaction effects between online reviews and free samples for different types of software. Through our empirical analysis, we find that user ratings significantly increase consumers’ sample downloads. Furthermore, consumers download more samples for some categories than for others. Finally, user and editor ratings might have differential effects for different types of software.

The shifting psychology of food safety: from sensory evaluation to a cognitive assessment

Understanding the psychological basis of food safety assessment in an era of infectious diseases becomes paramount. Functioning within a globalized food supply chain, there is a shift from sensory assessment to cognitive assessment of food safety. This short essay assesses the sensory versus cognitive evaluation of food safety. As a result of such a shift, a crucial aspect in food safety perception is the outstanding question of whether the public understands modern food safety systems. Despite an effort to reduce consumer uncertainty when buying routine and exotic food items, there has been a significant shift from a direct safety assessment to an indirect information processing paradigm. Moving away from sensory to cognitive assessment leads to higher information load that may not serve to ensure consumer confidence in food safety.

Reducing Consumer Uncertainty: Towards an Ontology for Geospatial User-Centric Metadata

With the increased use of geospatial datasets across heterogeneous user groups and domains, assessing fitness-for-use is emerging as an essential task. Users are presented with an increasing choice of data from various portals, repositories, and clearinghouses. Consequently, comparing the quality and evaluating fitness-for-use of different datasets presents major challenges for spatial data users. While standardization efforts have significantly improved metadata interoperability, the increasing choice of metadata standards and their focus on data production rather than potential data use and application, renders typical metadata documents insufficient for effectively communicating fitness-for-use. Thus, research has focused on the challenge of communicating fitness-for-use of geospatial data, proposing a more “user-centric” approach to geospatial metadata. We present the Geospatial User-Centric Metadata ontology (GUCM) for communicating fitness-for-use of spatial datasets to users in the spatial and other domains, to enable them to make informed data source selection decisions. GUCM enables metadata description for various components of a dataset in the context of different application domains. It captures producer-supplied and user-described metadata in structured format using concepts from domain-independent ontologies. This facilitates interoperability between spatial and nonspatial metadata on open data platforms and provides the means for searching/discovering spatial data based on user-specified quality and fitness-for-use criteria.

Regulating Innovation with Uncertain Quality: Information, Risk, and Access in Medical Devices

We study the impact of regulating product entry and quality information requirements on an oligopoly equilibrium and consumer welfare. Product testing can reduce consumer uncertainty, but also increase entry costs and delay entry. Using variation between EU and US medical device regulations, we document patterns consistent with valuable learning from more stringent US requirements. To derive welfare implications, we pair the data with a model of supply, demand, and testing regulation. US policy is indistinguishable from the policy that maximizes total surplus in our estimated model, while the European Union could benefit from more testing. “Post-market surveillance” could further increase surplus. (JEL D43, I18, L13, L51, L64, O31, O38)

The Impact of Augmented Reality for Displaying Virtual 3d Models of Products in Real Environments on Improvement of the Consumer Experience in Buying Industrial Designed Products

The purpose of this paper is to explore the possibilities for implementation of the augmented reality (АR) in the sales. The augmented reality contributes to enhansing and improving the consumer experience through the virtual display of 3D models of products in realistic environments. In this paper is presented an overview of the consumer behavior in online shopping and their uncertainties in the process. The online shopping offers more satisfaction to the modern consumers looking for comfort and speed. On the other hand, some consumers still feel uncomfortable to shop online. What prevents them from buying online is the inability to realistically check the products, to examine their different variants, and to show them to their friends from which they will get comments and opinions before the purchase. In this thesis are examined the possibilities for implementation of augmented reality technology in online stores, as well as the possibilities for management of the product configurations in AR – options for choosing different materials and colors of the product, that will allow the customers to adjust the product to their needs. The aim is to find methods and techniques that would alleviate the disadvantages as result of the lack of physical contact with the products during online sales, that would reduce the consumer uncertainty and increase the likelihood of successful choice and increased online sales.

Faktor yang Mempengaruhi Intensitas Pembelian Smartphone Cina di Indonesia

Tujuan penelitian ini adalah untuk menganalisis faktor-faktor yang mempengaruhi intensitas pembelian China smartphone di Indonesia. Data dari penelitian diperoleh dari 484 kuesioner yang didistribusikan kepada seluruh responden di Indonesia. Analisa data dalam penelitian ini menggunakan program SmartPLS. Hasil penelitian ini menemukan bahwa attitude toward product, consumer uncertainty, functional value, price consciousness dan consumer aspiration berpengaruh signifikan terhadap keputusan pembelian sedangkan sosial value tidak berpengaruh signifikan terhadap keputusan pembelian China smartphone di Indonesia. Penelitian ini bermanfaat bagi perusahaan yang memproduksi China smartphone untuk mengetahui bukti empiris mengenai intensitas pembelian produk mereka. Penelitian ini memiliki beberapa keterbatasan yang dapat dikembangkan pada penelitian selanjutnya, seperti meneliti dari sudut pandang aplikasi yang ada di China smartphone atau komponen lainnya yang lebih terkait dengan manajemen teknologi informasi.

Paying Before or Paying After? Timing and Uncertainty in Pay-What-You-Want Pricing

Pay what you want (PWYW) is a relatively new and promising pricing mechanism, where consumers have full control over the price they pay. It can potentially increase profits, but its practical applications have produced mixed results. The time of payment, and its implications for consumer uncertainty, might constitute an important determinant of the profitability of such pricing schemes for service providers. A large field experiment conducted in conventional and fast-food restaurants provides initial support that paying after consumption increases PWYW amounts. A laboratory study then details the underlying psychological process; payments after consumption help resolve uncertainty about the service process and service outcome. Another study affirms these insights and further shows that PWYW after consumption, compared with fixed pricing, can increase profitability due to enhanced service capacity utilization. By detailing how timing and uncertainty reduction affect consumers’ chosen payments, this article contributes to PWYW research in particular, as well as more general literature pertaining to the dynamics that affect consumers’ service experiences and service pricing studies.