The Impact of eBay’s Buy-It-Now Function on Bidder Behavior

Stephen S. Standifird, Matthew R. Roelofs, and Yvonne Durham
International Journal of Electronic Commerce,
Volume 9, Number 2, Winter 2004-05, pp. 167.

Abstract: The impact of eBay’s Buy-It-Now function on bidder behavior was investigated by conducting auctions of American Eagle silver dollars with and without the function. The study found that eBay buyers did not use the Buy-It-Now option even when Buy-It-Now prices were set below prevailing market prices. The entertainment, or “hedonic,” benefit associated with eBay auctions may explain this somewhat counterintuitive finding. Firms engaging in e-commerce can take advantage of this phenomenon by structuring transactions to provide consumers with hedonic benefits.

Key Words and Phrases: Buy-It-Now, hedonic benefits, on-line auctions.