The Impact of Product Classification for Online Auctions

Abstract

Consumers usually prefer to touch and feel, smell, and try on products before purchasing. Consequently products with high sensory requirements are likely to be perceived as more risky to buy online. Products with variable functionality, such as electronics, are also difficult to evaluate prior to purchase and fragile items run the risk of being damaged during delivery. Furthermore, while commodities are usually easy to specify, specialized products with high product description complexity are more of a challenge to specify accurately for the consumer online. Negative feedback posted on eBay is analyzed to calculate the rate of complaints for different product categories. We hypothesize that high sensory, complex products with variable functionality and high fragility generate more complaints than low sensory, simple products with little variable functionality and low fragility. This study has important implications for research as well as for online auctions, buyers and sellers.