Search, Showrooming, and Retailer Variety

Heski Bar-Isaac and Sandro Shelegia ()
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Sandro Shelegia: Center for Economic and Policy Research, London EC1V 0DX, United Kingdom; Department of Economics and Business, Pompeu Fabra University, 08002 Barcelona, Spain; Barcelona School of Economics, 08005 Barcelona, Spain

Marketing Science, 2023, vol. 42, issue 2, 251-270

Abstract: Pricing depends on the selection of consumers and the way that they search. Consumers who search for prices, paradoxically, impose no discipline on prices. Instead, searching for match information does. Showrooming disciplines prices at deep stores (where consumers can learn about many goods in a category). It also leads shallow stores, where showroomers buy, to face a larger fraction of consumers who are insensitive to price. The overall effect of more showrooming can be to raise or lower prices. It depends on the kinds of consumers who showroom. Similarly, a price-only channel can have ambiguous effects.

Keywords: consumer search; pricing; retailer variety; showrooming (search for similar items in EconPapers)
Date: 2023
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http://dx.doi.org/10.1287/mksc.2022.1376 (application/pdf)

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Working Paper: Search, Showrooming, and Retailer Variety (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:inm:ormksc:v:42:y:2023:i:2:p:251-270

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