Research Projects in Online Marketing
Offline-Online Cross-Media Effect
An ongoing debate questions whether TV viewers can spread their attention across multiple devices while watching TV, for example by concurrently shopping online or posting on social media. Recent research has focused on understanding cross media effects; however, little attention has been given to TV viewership’s relationship with a very important economic activity, namely the participation in online auctions. This study examines whether online auction sellers need to account for exogenous effects like TV viewing when timing and predicting their auctions. We examine this potential cross-media effect by analyzing a four-year sales history of a German online auction platform and by addressing potential endogeneity problems with an instrumental variable approach. We use three different instrumental variables (special broadcasts on disasters, Soccer World Cup broadcasts and broadcasts reporting about the US presidential elections) that come with different advantages and disadvantages but can — in sum — be used for triangulation as they lead to the same result: The analyses reveal a significant negative cross-media effect between TV consumption and online auction sales indicating that TV consumption and online auction sales might compete for the scarce attention of consumers and are therefore substitutes for each other, rather than complements.
Status: in progress
Pay-Per-Bid Auctions
Pay-per-bid auctions offered by retailers, such as Quibids, Bidcactus and MadBid, are exciting, fast-paced business-to-consumer online auctions that are attracting significant interest from consumers, popular press and start-up companies. Unlike other well-known auctions sites, such as eBay, pay-per-bid auctions charge a fee for each bid that is placed, regardless of whether one wins the auction. Additionally, a bid placed increases the price by a certain increment that is chosen by the auctioneer. For example, in the case of Quibids, the most popular pay-per-bid auction, bidding begins at €0.00 with no reserve price. Each bid increases the price by an increment, usually €0.01, costs the bidder €0.40 and extends the length of the auction by up to twenty seconds. At first glance, fee-based bidding does not sound attractive because the bidder encounters the risk of having to pay bidding fees without winning the auction. However, the compelling part of this model is that the bidders who win an auction can potentially save more than 99% off the current retail price (CRP) of the product. For example, on MadBid.com, a new MINI One car was sold for €8.47 rather than its retail price of €15,000. Similarly, a new Kymco scooter, which regularly sells for €1,240, was sold for €0.40. Popular magazines, newspapers and online blogs are replete with heated discussions regarding this emerging type of auction. Although some commentators are enthusiastic about the attractive deals offered by pay-per-bid auctions and how enjoyable they are, others strongly warn consumers against participating in them. Such commentators point to potentially huge losses for bidders as a result of the high bidding costs, which can easily be in the range of several hundred dollars per auction. However, all commentators have based their conclusions on a fairly limited number of observations, some of which are quite anecdotal.
As part of our research, we
- theoretically and empirically assess the economic effects of different pay-per-bid auction formats. In particular, we compare different price increments (penny vs. ten-cent auctions) of ascending auctions as well as of ascending and descending pay-per-bid auctions (see IJRM paper 2014)
- analyze overpaying as a process across multiple auctions (in progress)
The Effects of Incentives on Online Customer Reviews
Status: in progress
Online Scarcity Effects
Status: in progress
Targeting according to stages of preferences
Status: in progress
Creation of online ads
Status: in progress