Risk profile and consumer shopping behavior in electronic and traditional channels
This paper develops an economic model that captures consumer shopping channel choices based on shopping channel characteristics and consumer risk profilesrisk-neutral or risk-averse. Analyses of results show that after making purchases through one channel, electronic or traditional, risk-averse consumers tend to be more loyal customers than risk-neutral consumers. Further, the two types of consumers may exhibit split channel behaviorrisk-neutral consumers prefer one channel and risk-averse consumers prefer the other. However, risk-neutral consumers are not always more likely to prefer electronic channel than risk-averse consumers. Implications for retailer pricing strategies are discussed.
pricing e-commerce retail channel switching consumer risk profile online shopping behavior