The Substitutability between Brick-and-Mortar Stores and e-Commerce - The Case of Books

Georg Goetz (), Daniel Herold, Phil-Adrian Klotz and Jan Thomas Schaefer
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Georg Goetz: Justus Liebig University Giessen
Daniel Herold: Justus Liebig University Giessen
Phil-Adrian Klotz: Justus Liebig University Giessen
Jan Thomas Schaefer: Justus Liebig University Giessen
Authors registered in the RePEc Author Service: Georg Götz

MAGKS Papers on Economics from Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung)

Abstract: We analyze the substitutability between brick-and-mortar stores and e-Commerce. Using a novel data set on the German book market we find that between 26 and 55% of the decrease in book sales from 2014-2017 can be explained by the decrease in the number of bookstores. This indicates that brick-and-mortar stores and e-Commerce are imperfect substitutes. One explanation could be that some consumers prefer to purchase books offine because of the service provision in brick-and-mortar stores (e.g., advice, atmosphere, presentation, sales-effort, etc.). We also find that the degree of substitutability differs between different types of books. When a bookshop closes the decrease in sales of fiction titles is more than 2 times larger than the decrease in sales of non-fiction titles. Our findings indicate that regulatory measures and vertical restraints that increase the number of bookstores can have a positive effect on the demand for books even in the presence of e-Commerce.

Keywords: Experience goods; Retailing; e-Commerce (search for similar items in EconPapers)
Pages: 32 pages
Date: 2020
New Economics Papers: this item is included in nep-com, nep-cul and nep-eur
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:mar:magkse:202011

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