Buyer search costs for price are changing in many markets. Through a model of buyer and seller behavior, I consider the effects of changing search costs on prices both when product differentiation is fixed and when it is endogenously determined in equilibrium. If firms cannot change product...

This paper defines a unique type of product or service offering, termed , and analyzes a novel selling strategy, termed (PS). A probabilistic good is not a concrete product or service but an offer involving a probability of getting any one of a set of multiple distinct items. Under the...

Structural models integrate behavioral and psychological decision theory into economics models and are more aligned with the true underlying economic primitives of the consumers. This allows researchers to investigate more behavior-driven and process-oriented customer decision processes such as...

This paper presents an initial examination of an emerging business model, the Name-Your-Own-Price (NYOP) channel, as popularized by priceline.com. Focusing on how to optimally structure such market interactions, I ask whether it is more profitable to restrict individuals to a single bid, as is...

The e-marketplace has emerged as an important electronic shopping environment that, according to a recent report, may evolve into a dominant force in Internet marketing. We investigate an e-marketplace with online stores offering competing products. We find that featuring is associated with a...

Reverse pricing is a market mechanism under which a consumer's bid for a product leads to a sale if the bid exceeds a hidden acceptance threshold the seller has set in advance. The seller faces two key decisions in designing such a mechanism. First, he must decide where in the process to collect...

When a firm allows the return of previously purchased merchandise, it provides customers with an option that has measurable value. Whereas the option to return merchandise leads to an increase in gross revenue, it also creates additional costs. Selecting an optimal return policy requires...

Adaptive metric utility balance is at the heart of one of the most widely used and studied methods for conjoint analysis. We use formal models, simulations, and empirical data to suggest that adaptive metric utility balance leads to partworth estimates that are relatively biased—smaller...

A whole slew of companies have chosen to adopt multi-channel distribution strategies wherein a given customer induced to visit several channels simultaneously to derive the specific advantages that each channel offers at a different stage of the decision-making process. The present article...

Our purpose in this article is to present the concept of electronic agent used in e-commerce and its impact on consumer satisfaction. Electronic agents represent the future of electronic business. They help the consumers in an environment where all the information is available but hard to deal...