The moderating effect of transaction experience on value-driven internet shopping

Internet vendors invest a considerable amount on acquiring customers with the expectation that the early investment in customer acquisition will result in a long-term stream of profits from repeat customers. However, it has been found that over 50% of repeat customers seldom complete their third purchase with the Internet vendor. This may be due to lack of proper understanding of customer decision making and a lack of differentiation between less-experienced and more-experienced repeat customers. Therefore, Internet vendors need to understand the decision making process of their repeat customers. Customer decision making has been studied from value perspective in the fields of economics and marketing and have been replicated in the IS field also. However, the focus in IS studies has largely been on new customers. Moreover, the IS studies lack consideration of changes in customer information processing with transaction experience. This research, therefore, studies the moderating effect of transaction experience on repeat customer value-driven Internet shopping behaviour. Understanding the changes in repeat customer decision making would help Internet vendors in outlining sales strategies to ensure continuous sales and long-term profitability.