A critical challenge for online retailers is to determine what types of product and price information are best suited to influence online conversion. While it has long been known that customers differ in their state of shopping, it is cumbersome to learn about such latent differences offline. The availability of clickstream data however helps us in identifying meaningful segments of sessions on the basis of customers’ online behaviors. We examine whether product and price information had different impacts on customers belonging to three states of shopping, and also assess the effect on outcomes within a session and across sessions. Our results question the practice of offering price promotions to all customers of a store, and highlight the value of product information in increasing loyalty for some customers. Depending on the retailer’s goal– short term conversion versus longer-term customer relationship–a different information provision strategy is likely to be optimal.
Available at: http://works.bepress.com/siva_viswanathan/2/