Overbidding in electronic auctions: factors influencing the propensity to overbid and the magnitude of overbidding

Cong Feng, Scott Fay, K. Sivakumar

Research output: Contribution to journalArticle

8 Scopus citations

Abstract

This research investigates the buyer and seller characteristics that impact overbidding in electronic auctions. Specifically, the empirical analysis shows that customers with more total experience are less likely to overbid and that overbidding is less frequent for auction items with higher face values. When bidder experience pertains to the same product category, the frequency and magnitude of overbids are further reduced. This research also finds that consumers are more likely to overbid as the bidding environment becomes more competitive. Furthermore, auction item attributes, such as starting price, day/time of the auction, and shipping fees, are shown to impact the propensity to overbid and the magnitude of overbidding. The empirical results have important implications for understanding bidder behavior and for assisting online sellers in formulating more profitable selling strategies.

Original languageEnglish (US)
Pages (from-to)241-260
Number of pages20
JournalJournal of the Academy of Marketing Science
Volume44
Issue number2
DOIs
StatePublished - Mar 1 2016

Keywords

  • Auction value
  • Competition
  • Customer experience
  • Electronic auctions
  • Overbidding

ASJC Scopus subject areas

  • Business and International Management
  • Economics and Econometrics
  • Marketing

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