The Impact of the Introduction and Use of an Informational Website on Offline Customer Buying Behavior

Abstract

Do customers increase or decrease their spending in response to the introduction of an informational website? To answer this question, this study considers the effects of the introduction and use of an informational website by a large national retailer on offline customer buying behavior. More specifically, we study its effects on the number of shopping trips and the amount spent per category per shopping trip. The model is calibrated through estimation of a Poisson model (shopping trips) and a type-II tobit model (amount spent per category per shopping trip), with effect parameters that vary across customers. For the focal retailer, an informational website creates more bad than good news; most website visitors engage in fewer shopping trips and spend less in all product categories. The authors also compare the characteristics of shoppers who exhibit negative website effects with those few who show positive effects and thus derive key implications for research and practice.

Keywords: Website, Online and Offline Behavior, Decomposition

JEL Classification: M13, C15, C24, D12