A Customer Purchase Incidence Model Applied to Recommender Services

Abstract—In this contribution we transfer a customer purchase incidence model for consumer products which is based on Ehrenberg’s repeat-buying theory to Web-based information products. Ehrenberg’s repeat-buying theory successfully describes regularities on a large number of consumer product markets. We show that these regularities exist in electronic markets for information goods too, and that purchase incidence models provide a well founded theoretical base for recommender and alert services. The article consists of two parts. In the first part Ehrenberg’s repeat-buying theory and its assumptions are reviewed and adapted for Web-based information markets. Second, we present the empirical validation of the model based on data collected from the information market of the Virtual University of the Vienna University of Economics and Business Administration at http://vu.wu-wien.ac.at from September 1999 to May 2001.