Consumer Online Search with Partially Revealed Information

Modern-day search platforms generally have two layers of information presentation. The outer layer displays the collection of search results with attributes selected by platforms, and consumers click on a product to reveal all its attributes in the inner layer. The information revealed in the outer layer affects the search costs and the probability of finding a match. To address the managerial question of optimal information layout, we create an information complexity measure of the outer layer, namely orderedness entropy, and study the consumer search process for information at the expense of time and cognitive costs. We first conduct online random experiments to show that consumers respond to and actively reduce cognitive cost for which our information complexity measure provides a representation. Then, using a unique and rich panel tracking consumer search behaviors at a large online travel agency (OTA), we specify a novel sequential search model that jointly describes the refinement search and product clicking decisions. We find that cognitive cost is a major component of search cost, while loading time cost has a much smaller share. By varying the information revealed in the outer layer, we propose information layouts that Pareto-improve both revenue and consumer welfare for our OTA. This paper was accepted by Juanjuan Zhang, marketing.

How Do Restrictions on Advertising Affect Consumer Search?

Advertising is often criticized for presenting only partial or selective information about products. This criticism is particularly pronounced for health products, where large asymmetries in information may exist between consumers and firms. This paper explores how government restrictions designed to prevent selective advertising affect the types of information to which consumers are exposed. We exploit a natural experiment in the form of a U.S. Food and Drug Administration (FDA) crackdown that prevented pharmaceutical companies from using selectively chosen information in their Internet search ads. Because companies could not adequately document side effects within the advertising space allowed, they removed their ads. Our results suggest that, after the ads were removed, consumers were more likely to seek information from websites based on user-generated content or websites that focused on medical treatments not regulated by the FDA, such as Canadian pharmacies and sites promoting herbal remedies. This paper was accepted by Matthew Shum, marketing.

A systematic review of consumer information search in online and offline environments

Purpose The purpose of this study is to identify major themes and potential research opportunities in online and offline consumer search. Design/methodology/approach A systematic review was conducted based on 118 articles identified from prevalent journal databases. Keywords frequency analysis was carried out to identify the major themes. An inductive thematic analysis was carried out to verify the generated themes. Findings Results show that uncertainty, knowledge, perceived risk, price, experience and involvement are the major themes associated with consumer information search. Uncertainty, one of the major themes of offline search, has not been studied in the online search context. Similarly, the previous experience needs to be explored in the context of the offline search. Finally, potential research opportunities for future research has been summarized based on the retrieved themes. Research limitations/implications The systematic review provides an in-depth understanding on the current research on information search literature with future research directions. Practical implications This study helps retailers to understand the key elements that motivate consumers to perform external information searches from online and offline sources and to curate targeted information provision strategies to influence purchase decisions. Social implications Consumers with limited internet availability may access channels prior to decision-making. The themes identified in this study can aid policymakers to design affordable access to these channels. Originality/value This study adds to the sparse literature on systematic reviews on consumer search for online and offline channels.