Battle of the Channels: The Impact of Tablets on Digital Commerce

Management Science, Forthcoming

58 Pages Posted: 4 Nov 2015

See all articles by Kaiquan Xu

Kaiquan Xu

Nanjing University

Jason Chan

University of Minnesota - Twin Cities - Carlson School of Management

Anindya Ghose

New York University (NYU) - Leonard N. Stern School of Business

Sang Pil Han

Arizona State University, W.P.Carey School of Business

Date Written: November 3, 2015

Abstract

The introduction of tablets in online retailing has created an additional touch point through which e-commerce firms can interact with consumers. In this paper, we seek to understand and measure the causal impact of tablets on e-commerce sales. In doing so, we examine the complementary and substitution impact of the tablet channel on the smartphone and PC channels. We rely on a unique dataset from Alibaba — the largest e-commerce firm in the world — and exploit a natural experiment via the iPad app introduction to empirically identify our results. The results show that users’ adoption of tablets enhanced the overall growth of Alibaba’s e-commerce market, with an annual increase of approximately US$923.5 million. Our results demonstrate that the tablet channel acts as a substitute for the PC channel while it acts as a complement for the smartphone channel. Further, the use of tablets spurs casual browsing which leads to the purchase of more impulse products and a wider diversity of products. Cross-device browsing behavior is found to enhance sales outcome and the degree of interrelationship between devices varies across the course of the day. We provide insights for retailers about how they can increase their sales volume and revenue in the emerging tablet economy.

Keywords: Mobile, Tablet, Ecommerce, Channels, Natural experiment

Suggested Citation

Xu, Kaiquan and Chan, Jason and Ghose, Anindya and Han, Sang Pil, Battle of the Channels: The Impact of Tablets on Digital Commerce (November 3, 2015). Management Science, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2685902

Kaiquan Xu

Nanjing University ( email )

Nanjing, Jiangsu 210093
China

Jason Chan (Contact Author)

University of Minnesota - Twin Cities - Carlson School of Management ( email )

19th Avenue South
Minneapolis, MN 55455
United States

HOME PAGE: http://carlsonschool.umn.edu/faculty/jason-chan

Anindya Ghose

New York University (NYU) - Leonard N. Stern School of Business ( email )

44 West 4th Street
Suite 9-160
New York, NY NY 10012
United States

Sang Pil Han

Arizona State University, W.P.Carey School of Business ( email )

Tempe, AZ 85287-3706
United States
480-965-8603 (Phone)

HOME PAGE: http://https://apps.wpcarey.asu.edu/directory/people/profile.cfm?person=2255149

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