How Signaling Strategy Moderates the Strategic Signaling-Seller Performance Relationship in E-marketplace

We propose that e-marketplace sellers’ performances are shaped by how sellers deploy signals. Recent research on the signal-performance relationship proposes variety of signal attributes to create a more robust link. However, few of them explore the role of the signaling strategy, let alone empirically testing its effect. Drawing on signaling theory and literatures on strategic management, we argue that when a seller deploys more observable and costly signals that are easy-to-verify, highly correlated with unobservable quality and consistent with each other, their performance will be enhanced. We plan to apply Bayesian Decision-Theoretic framework to analyze signaling decisionmaking situations in terms of their preference signaling strategy structures and posterior performance. The findings can (1) help sellers obtain better signaling outcomes through the active use of varied signaling strategies and (2) inform transaction platform providers to improve their policies about seller information disclosure.