Bid or Buy? Individual Shopping Traits as Predictors of Strategic Exit in On-Line Auctions

Corey M. Angst, Ritu Agarwal, and Jason Kuruzovich
International Journal of Electronic Commerce,
Volume 13, Number 1, Fall 2008, pp. 59.

Abstract: This paper examines the behavioral aspects of bidder conduct in on-line auctions. It utilizes price data from 113 on-line auctions, surveys of winning bidders, and draws upon the consumer behavior and auctions literature to examine individual trait differences in shopping preferences that predict a buyer’s decision to use ‘strategic exit,’ the fixed-price Buy-It-Now (BIN) functionality. It argues that impulse-buying tendencies, trait competitiveness, and hedonic need fulfillment are antecedents of strategic exit, and that hedonic need fulfillment moderates the effect of impulse-buying tendencies on strategic exit. Buyers who exit an auction early by using the BIN feature end up paying a higher than average price. Theoretical and practical implications for the design of electronic auctions and the process of selling goods are offered.

Key Words and Phrases
: Auctions, behavioral predictors, Buy-It-Now, hedonic need, impulse buying, on-line auctions, product knowledge, shopping traits, strategic exit, trait competitiveness.