Online from: 1988
|Title:||Can retailers get higher prices for 'end-of-life' inventory through online auctions?|
|Author(s):||Wood C M, Alford B L, Jackson R W, Gilley O W|
|Journal:||Journal of Retailing, 2005, Volume: 81 Issue: 3 pp.181-190 (10 pages)|
|Keywords:||Auctions, Consumer Behaviour, Ebay, Fashion Industry, Internet, Selling|
|Article type:||Research paper|
|Reference:||34AW657 (Permanent URL)|
Design/methodology/approach - Analyses the results of 11,885 auctions for ladies' apparel on eBay, systematically manipulating the factors of interest over a six-month period, to examine the effects of the seller controllable factors on the number of bids received and percentage of retail price obtained and then estimates a two-stage prediction process to determine the optimal combination of variables.
Findings - The seller-controlled independent variables had similar effects on the two dependent variables in all cases except two: the effect of the length of the auction on the dependent variables and the effect on the number of bids received of the day of close for the auction. Discovers that, for national brand items and private-label brand items, the highest percentage of retail is recovered by offering the item in a three-day auction that ends on a weekday with a starting price of $1. Suggests that the perceived risk in online auctions may be more focused on the online environment and the auction process itself rather than on the individual product level.
Research limitations/implications - Recommends studies that exercise full control over the factors influencing competitive behaviour between bidders, exploring multiple auctioneers and a variety of product categories, obtaining a more complete picture of bidders' acceptable price range and examining whether individual difference traits have an important influence on behaviour when a person is engaged in a competition. Also suggests exploring the applicability of the findings to other types of contests and auctions and examining the concept of online communities.
Practical implications - To maximize the percentage of retail, advises retailers to start with a lower price and run a shorter auction closing on a weekday.
Originality/value - Provides guidance to retailers on how to use the online mechanism to dispose of merchandise by looking at the influence of the major seller tactics on the final price received for merchandise in online auctions.