Structural Differences in Electronically Mediated Ultimatum Negotiations: How Negotiation Role and Awareness of Alternatives Influence Customer Outcomes
11 Pages Posted: 20 May 2005
Date Written: 2005
Bargaining activities now often take place electronically. Many travel-related exchanges occur through discount intermediaries such as Priceline and Hotwire, who offer customers opportunities to acquire travel-related items at reduced cost; in return customers give up prior knowledge regarding what hotel or airline will provide them service. We examine the bidding behavior and subjective reactions of customers who experience different intermediary structures, and different numbers of alternatives. Subjects participated in an electronic simulation to purchase a hotel room for a future trip. The task structure varied: Subjects were either in the role of offerer (providing a specific price for the hotel, which the intermediary then accepted or rejected) or acceptor (receiving a specific price for the hotel from the intermediary, which the subject then accepted or rejected). In addition, the intermediary provided them with one or three potential hotels from which to choose. Our results call into question some of the assumptions inherent in the ultimatum bargaining literature, such as the belief that participants prefer to be in the role of offerer, as in our context we find that participants prefer to be in the role of the acceptor. We discuss this and other findings related to our manipulations and to characteristics of the participants (such as self-efficacy and uncertainty avoidance).
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