Channel of exposure and its effect on purchase decision: Evidence from an online retailer

• Main Author: LI, Lei
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2024
• Subjects: multi-channel marketing; online conversion; attribution modeling; information overload; attention allocation; channel diversity; E-Commerce; Strategic Management Policy
• Online Access: https://ink.library.smu.edu.sg/etd_coll/578; https://ink.library.smu.edu.sg/context/etd_coll/article/1576/viewcontent/GPBA_AY2017_DBA_Li_Lei.pdf
• Institution: Singapore Management University

In the digital era, online retailers engage consumers through a variety of channels, making it critical to understand how multi-channel exposure impacts consumer behavior, purchase conversion and firm outcomes. Drawing upon information overload and attention theories as well as extant research on conversion models, this study examines how channel-specific browsing time and channel diversity influence online users’ conversion and revenue contribution. By utilizing a multi-touch attribution approach, this study analyzes user-level visit data from an online eyewear retailer including millions of visits over a three-month period and finds that cumulative browsing time has a positive impact on both conversion and revenue, with search engine emerging as the most effective channel for driving purchase conversions and organic social media yielding higher-value orders. Recency is considered to reflect the effect decay over time. Importantly, channel diversity acts as a double-edged sword - while it has a positive main effect on conversion probability, it negatively moderates the impact of browsing time within each channel on both outcomes, suggesting potential information overload and curvilinear relationship. These findings underscore the complex interplay between channel effectiveness and consumer attention allocation in a multi-channel environment. This research advances theories of information processing and multi-channel marketing while providing actionable insights for online retailers to optimize their marketing strategies by aligning budgets with channel effectiveness to achieve an optimal channel mix yileding optimal conversion and revenue.