The Persuasive Nature of Web Personalization on Online Users’ Product Perception: A Mental Accounting Perspective

Abstract

E-commerce firms strive to enhance engagement by providing augmented experiences to online users. This research focuses on one such shopping experience enhancement technique—Web personalization. In this study, we examine how personalization affects online users’ perceptions and how different personalization levels differentially impact those perceptions. Drawing on mental accounting theory, we argue that personalization, by providing convenience in online buying, increases transaction utility and, thus, influence online users’ product perceptions. We conducted a laboratory experiment in a public university in Southern India where users took buying decisions at four different personalization levels: zero, low, medium, and high. The findings from this study suggest that product prices affect users’ perceived product quality, which, in turn, affects their perceived product values and, subsequently, their final purchase decision. Web personalization plays a moderating role in all cause-effect relations above. This study contributes to the existing literature on the Web personalization strategy and online user behavior. We find empirical evidence to show that personalization plays a moderating role in the relationship between user perception and intention to purchase.