The Intertemporal Dynamics of Consumer Lock-In

Gal Zauberman

Journal of Consumer Research, 2003, vol. 30, issue 3, 405-19

Abstract: This article examines how dynamic changes in information cost structure and time preferences affect consumers' search and switching behavior over time and lead to lock-in. The information cost structure is conceptualized as a trade-off of initial setup costs and ongoing usage costs. Lock-in is defined as consumers' decreased propensity to search and switch after an initial investment, which is determined both by a preference to minimize immediate costs and by an inability to anticipate the impact of future switching costs. The results of three experiments support the proposed mechanism. Experiment 1 shows that a small initial investment is sufficient to produce lock-in. Experiment 2 shows that the results of a prior investment on lock-in are not due to psychological commitment but to a shift in relative costs of incumbent and new options. Experiment 3 shows that respondents fail to anticipate how their prior investment will lock them in. Copyright 2003 by the University of Chicago.

Date: 2003
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Persistent link: https://EconPapers.repec.org/RePEc:oup:jconrs:v:30:y:2003:i:3:p:405-19

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