Editor’s Introduction 19(2)

Vladimir Zwass, Editor
International Journal of Electronic Commerce,
Volume 9, Number 2, Winter 2014-15, pp. 1-2.

Keyword-based advertising on search engines has become a leading form of online marketing and a potent means of monetizing the operation of the engines. It is one of the big ideas of e-commerce. The match between the keywords entered by users and the brief sponsored ad served to them is done by a multicriteria automated auction that determines also the crucial position of the ad on the response page. Billions of such auctions take place daily, and the tactic of keyword bidding adopted by the user strongly influences the success of a campaign. Should users set a fixed bid, or is it advantageous for them to keep changing the bid based on a predefined algorithm (bid pulsing)? In the opening paper of this IJEC issue, Savannah Wei Shi and Xiaojing Dong present an empirical study of this matter. In a thoroughgoing investigation, the authors show the advantages of bid pulsing, with a further amplification of performance with the increased frequency and scale of the pulsing. This is an important contribution to our knowledge about generalized second price auctions (a variation on Vickrey auctions). With the multifaceted results presented, this paper is also a detailed guideline for search engine marketers.

Online auctions are also the subject of the work by Chia-Chi Chang and Chi-Wen Chen. The context here is C2C auctions, and the bidding is done, of course, by consumers. As we know, they are motivated to participate both by seeking the acquisition (utilitarian motivation) and by pleasure seeking (hedonic motivation). In a theory-based field study, the authors aim to establish the influence of the competitive spirit and of the time pressure on these motivations and, further, on the consumer’s impulse bidding and satisfaction with the process. The granular results are both a contribution to our understanding of bidding motivators and a source of advice to the designers and operators of C2C auction platforms.

Founding her research in the social exchange theory, Eleanor T. Loiacono investigates the willingness of users to disclose their personal information on social networking sites (SNSs). Self-disclosure is a crucial factor in the success of an SNS as it enriches the connections and relationships among the users; it also often runs against the user’s espoused desire for privacy. The author’s study relates self-disclosure to the “Big Five” personality traits, thus contributing to social exchange theory. By showing which of the traits lead to a greater willingness to self-disclose, the author also provides the guideline to SNSs in their efforts to attract the active types of users.

Online product reviews have become a principal aspect of consumer co-creation of value online. They are commonly used during the buyer’s decision-making process and have met with a sustained research effort in several of this journal’s papers, among other publications. However, the evaluations in these reviews frequently diverge. Here, Wujin Chu, Minjung Roh, and Kiwan Park contribute to our knowledge by empirically evaluating the effects of ratings’ dispersion on utilitarian versus hedonic products. The authors find significant difference in these effects. In particular, highly dispersed ratings are found to improve the evaluation of hedonic products. Together with other findings presented by the researchers, the paper contributes to the information-diagnosticity framework that it employs as a theoretical basis.

Virtual worlds (VW), such as Second Life, are the setting of the empirics presented by Bhuminan Piyathasanan, Christine Mathies, Martin Wetzels, Paul G. Patterson, and Ko de Ruyter. VW features are also offered by various brands in order to engage their prospective or actual customers with the products. The researchers seek to establish how customers’ virtual experience with the product affects their perception of its value and their loyalty to the brand. Relying on activity theory, the authors define and exercise a comprehensive hierarchical model that seeks to integrate the individual and the communal experience as well the physical and virtual worlds. There are many specific results gained in this study about the effects of the use of virtual worlds on customers. The overriding message is that VW can be an effective and highly significant investment in attracting and keeping customers.

Taken together, the papers in this issue offer theory-founded empirics on keyword advertising, online auctions, social network sites, online reviews, and virtual worlds. This gives us an opportunity to reflect on the richness of the new phenomena that electronic commerce has engendered. This is also a promise of things to come.