Sloan Center for Internet Retailing - University of California, Riverside

The Sloan Center for Internet Retailing, located at the University of California, Riverside, is the world's leading university research center dedicated to improving the effectiveness of online retailing.

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Below are the most recent posts of the Sloan Center blog. We invite you to browse.

Hoffman, Donna L. and Thomas P. Novak, “Flow Online:  Lessons Learned and Future Prospects” (September 14, 2007). 

Abstract.  Although the flow construct has been widely studied over the past decade in marketing and related fields, it has proven to be an elusive construct to measure and model.  In this paper, we first examine two of the most important themes in flow research in the last decade: the conceptualization and measurement of flow in online environments and the marketing outcomes of flow.  Second, while the unique characteristics of the Internet contributed to our belief that flow was an important construct for understanding consumer use of the Web in 1996, the environment of the Web itself has changed radically over the past decade.  Thus, we consider the current context of the Internet for the role and application of the flow construct, as well as important related constructs that will be useful for understanding compelling experiences in the contemporary online environment.   Download pdf.

White, Tiffany B., Thomas P. Novak and Donna L. Hoffman, “Evidence and Consequences of Egocentric Accounting Biases in Customer-Seller Relationships” (September 9, 2007).

We investigate egocentric biases in mental accounting within the context of information-driven consumer seller relationships. Our research suggests that consumers keep “loose mental accounts” of exchange benefits and costs that are balanced when resource exchanges are either contingent or temporally integrated (i.e., exchanged in the same transaction). However, when non-contingent resource exchange is temporally separated (specifically when exchange benefits precede exchange costs), or when bias correction is impeded in the same transaction, consumers keep two mental accounts, assigning differential value to marketers’ versus their own resources. Consequently, consumers egocentrically devalue- and therefore feeling less obligated to reciprocate- firms’ benefit offerings.   Download pdf.

Novak, Thomas P. and Donna L. Hoffman, “The Fit of Thinking Style and Situation:  New Measures of Situation-Specific Experiential and Rational Cognition” (August 27, 2007).

Abstract:  Decades of theoretical and empirical research in social and cognitive psychology provide strong evidence that consumers process information in two distinct and qualitatively different ways:   rational and experiential.  However, there has been surprisingly little research attention devoted to explicitly measuring how situational influences directly impact thinking style.  Further, attempts to simultaneously measure the two dimensions of thinking style as either situation-specific or as an enduring state are even fewer and lack validation in a broad context.  In five studies, we develop and validate a new instrument for measuring experiential and rational situation-specific thinking style in the context of a range of performance tasks designed to induce primarily rational or experiential cognition, as well as in the context of differing motivations toward the same task.  We establish congruence effects related to the fit of situation-specific thinking style and the nature of the task on performance outcomes; also, we show that the prediction of task performance and related outcomes from dispositional thinking style is completely mediated by situation-specific thinking style.  Download pdf

A recent article by Andrew Schrock in the MIT Technology Review discusses how banner ads are effective even if online consumers never click on them. The article cites published research that suggests that even if people are explicitly ignoring your banner ads, they’re actually being implicitly exposed anyway. The research shows that even though most consumers don’t pay attention to banner ads or bother to click on them, something about the message still gets through and can be measured using “implicit memory” measures.

This was like deja vu all over again because more than a decade ago, media effectiveness guru Rex Briggs argued the very same thing, based on a widely cited industry study he did with Millward Brown.

It’s pretty easy to argue theoretically - and empirical research shows - that passive ads (TV, banner, you name it) may have some sort of persuasive impact even if people go out of their way to avoid paying attention to them. As Dan Mitchell observed in the New York Times, “Internet banner ads can work about as well as ads in traditional media.” (Uh, not exactly high praise.)

Yet, the idea that banner ads might work even if people don’t click on them completely misses the point of the power of the Internet as a communication medium!

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Mitch Wagner has an excellent new article in Information Week outlining five rules business should follow, with plenty of examples, in order to get the most out of Second Life.  I’d like to comment on an issue he raised in his fourth rule, “be smart about keeping out trouble-makers.”  In that context, he discusses strategies businesses can take to manage griefers who vandalize commercial interests, and noted that like the hyped-up claims that “the only activity in Second Life is cybersex,” griefing incidents are much less common than many pundits would have you believe.

Wired recently claimed that “kinky sex” was the “big draw” for enticing return traffic to Second Life, and there is certainly a lot written about sex in Second Life.  However, what is troubling is the assumption that Second Life is pretty much only about sex.  For example, in Wagner’s article, Lenovo V.P. David Churbuck is quoted as saying, “there is nothing to do in Second Life except, pardon my bluntness, try to get laid.”  (As an aside, I note that my one-year-old Lenovo T60 Thinkpad is woefully underpowered for running Second Life, so perhaps reliance on Lenovo hardware may be contributing to Mr. Churbuck’s perception that there is nothing to do in Second Life.  My Dell desktops work great, BTW.)

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There’s a two day Virtual Worlds Conference in San Jose, CA, October 10-11, that I’ll be checking out.  There will be five tracks related to various business aspects of virtual worlds.  Looking forward to meeting some interesting people there and hearing the latest ideas!  

ACR Special Pre-Conference on Online Consumer Behavior

Thursday, October 25, 2007
Peabody Hotel
Memphis, TN

Conference Co-Chairs:

Donna Hoffman, University of California, Riverside
Eric Johnson, Columbia University

Conference Program

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When I read Frank Rose’s recent article in Wired, “How Madison Avenue is Wasting Millions on a Deserted Second Life,” I felt a distinct sense of déjà vu. I’ve been wandering around in Second Life for the past three months, and what I read in Wired took me back a dozen years ago.

There are many parallels with virtual worlds and the early days of the commercial Web. Back in 1994, when the Web was still embarrassingly known as the “Information Superhighway,” Donna Hoffman and I wrote a short article about future commercial prospects for the Web. We noted that the Web was very different from what marketers had seen before, and that mindless application of traditional business models and current best practice was just not going to work. The conclusion of our 1994 article applies to virtual worlds in 2007, just as much as it did to the nascent Web in 1994: Continue reading →

Now that Paris Hilton has been released from jail, pundits are wondering whether there will be any fallout for the Hilton hotel brand name.  Research in marketing suggests that those wannabe consumers who closely identify with Paris Hilton will not be put off by her distasteful antics and criminal behavior; however, for those who find her on the sorry side, those negative perceptions may transfer to the brand. 

This may not be much of an issue for current Hilton hotel consumer loyalists - elite members especially may not care either way, especially if a hotel upgrade is in their future.  However, for current customers who have more of a choice, Starwood and Marriott should be looking even better about now.

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The UCR Sloan Center held a research networking workshop on May 3-4, 2007, at the historic Mission Inn in Riverside, California.  The workshop was limited to 20 attendees, 13 of whom were asked to prepare thought-provoking 15-minute presentations that dramatically deviate from the usual research talk.  Presenters were asked to introduce what they considered to be “the most intereresting under-addressed research question in Internet marketing.”

Goals of the workshop were to bring together a small group of behaviorally and quantitatively oriented scholars researching topics related to Internet marketing to:

• Promote awareness of the joint community’s common research interests;
• Identify exciting new research themes that can serve as the basis for future collaborations;
• Introduce scholars to the UCR Sloan Center for Internet Retailing and opportuntiies for direct interaction and research collaboration with industry partners.

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