Consumer Decision Making in Online Shopping Environments: The Effects of Interactive Decision Aids

Abstract

Despite the explosive growth of electronic commerce and the rapidly increasing number of consumers who use interactive media (such as the World Wide Web) for both pre-purchase information search and online shopping, very little is known about how consumers make purchase decisions in such settings. A unique characteristic of online shopping environments is that they allow vendors to create retail interfaces that include highly interactive features. One form of interactivity that is desirable from a consumer perspective is the implementation of sophisticated tools designed to assist shoppers in making their purchase decisions by customizing the electronic shopping environment to their individual preferences. The availability of such tools, which we refer to as interactive decision aids for consumers, may lead to a transformation of the way in which shoppers search for product information and make purchase decisions. The primary objective of this paper is to investigate the nature of the effects that interactive decision aids may have on consumer decision making in online shopping environments.A well-known phenomenon regarding purchase decision making is that consumers are often unable to evaluate all available alternatives in great depth and, thus, tend to use two-stage processes to reach their decisions. A typical purchase decision process may unfold as follows: First, the consumer screens a large set of relevant products and identifies a subset that includes the most promising alternatives. Subsequently, s/he evaluates the latter in more depth, performs relative comparisons across products on important attributes, and makes a purchase decision. Given the different tasks to be performed in the course of such a two-stage process, interactive tools that provide support to consumers in the following two respects are particularly valuable: (1) the initial screening of available products to determine which ones are worth considering further and (2) the indepth comparison of selected products before making the actual purchase decision. This paper examines the effects of two decision aids, each designed to assist consumers in performing one of the above tasks, on purchase decision making in an online store.The first of the two interactive tools, a recommendation agent (RA), allows consumers to more efficiently screen the (potentially very large) set of alternatives available in an online shopping environment. Based on self-explicated information about a consumer's own utility function (attribute importance weights and minimum-acceptable attribute levels), the RA generates a personalized list of recommended alternatives. The second decision aid, a comparison matrix (CM), is designed to assist consumers in making in-depth comparisons among those alternatives that appear most promising based on the initial screening. The CM allows consumers to organize attribute information about multiple products in an alternatives × attributes matrix and to have alternatives sorted by any attribute.Based on theoretical and empiri...

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