TY  - JOUR
AU  - Waldfogel,Joel
AU  - Chen,Lu
TI  - Does Information Undermine Brand? Information Intermediary Use and Preference for Branded Web Retailers
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 9942
PY  - 2003
Y2  - September 2003
UR  - http://www.nber.org/papers/w9942
L1  - http://www.nber.org/papers/w9942.pdf
N1  - Author contact info:
Joel Waldfogel
Frederick R. Kappel Chair in Applied Economics
3-177 Carlson School of Management
University of Minnesota
321 19th Avenue South
Minneapolis, MN 55455
Tel: 612/626-7128
E-Mail: jwaldfog@umn.edu

Lu Chen
E-Mail: lchen2@wharton.upenn.edu
AB  - Investments in brand provide one method for vendors to become known and convince potential customers that vendors will deliver as promised. Alternatively, third-party information on retailers' existence, as well as whether they tend to keep their commitments can serve a similar function and may undermine investments in brand. This study uses a 13-month panel dataset on 1998-99 Internet shopping behavior and use of information intermediaries by over 30,000 households to examine whether information use undermines brand. We find that individuals who take up using price comparison sites reduce their shopping at a broad group of branded retailers by about a tenth. Users of pure price comparison sites, such as DealTime and mySimon, also reduce their Amazon by about a tenth, while individuals using BizRate, which provides both price comparison and vendor reliability information, reduce their Amazon shopping by a fifth. The results have possible implications for both firm strategy and the evolution of market structure. If information weakens the pull of brand, then Internet retailing may grow less concentrated over time.
ER  -