Academic journal article Journal of Supply Chain Management

The Moderating Role of Product Categories in the Relationship between Online Fulfillment, Procurement, and Consumer Repurchase Intention: A Hierarchical Analysis

Academic journal article Journal of Supply Chain Management

The Moderating Role of Product Categories in the Relationship between Online Fulfillment, Procurement, and Consumer Repurchase Intention: A Hierarchical Analysis

Article excerpt

INTRODUCTION

Prior online retailing research has found that consumer satisfaction with the procurement process (the first stage of the online shopping experience, which manages online consumer activities to find and purchase products) and consumer satisfaction with the fulfillment process (the second stage of the online shopping experience, which is responsible for delivering the right product to the right place at the right time as well as managing returns to provide consumer service for consumer repurchase intention) are key operational drivers of e-business consumer repurchase intention (Heim & Sinha, 2001). However, empirical findings regarding the relative importance of those two drivers of consumer repurchase intention are inconclusive (Heim & Sinha, 2001; Wolfinbarger & Gilly, 2003). Some studies reveal that the contribution of the online procurement process to consumer repurchase intention is higher than that of the fulfillment process (Wolfinbarger & Gilly, 2003). Others highlight that the fulfillment process contributes to consumer repurchase intention more than the procurement process does (Heim & Sinha, 2001). One possible explanation is that potential moderators may exist which influence the relationship between consumer satisfaction with online procurement/fulfillment and consumer repurchase intention.

This research proposes that the number of product categories offered by online retailers may be one salient moderator. Decisions about the number of different product categories that a retailer offers lead to distinct retailer types ranging from general retail stores to specialty retail stores (Levy, Weitz & Ajay, 2009). General retail stores and specialty retail stores represent two polar extremes of retailer types. General retail stores offer a large number of different product categories, while specialty retail stores focus on a small number of related product categories (Dash, Schiffman & Berenson, 1976; Solomon, 2009).

Due to retail stores' different product variety strategies, online consumers may formulate different expectations of a retailer's online procurement and fulfillment processes (Ratner, Kahn & Kahneman, 1999). Specifically, consumers often have high hopes of searching for and locating a product at general retail stores, resulting in a high expectation of the procurement process at general retail stores, but a low expectation of the procurement process at specialty retail stores (Diehl & Poynor, 2010).

However, as the differences among products widen with the increase of product categories, material handling and storage become more heterogeneous, which complicate general retail stores' order fulfillment processes and make efficient and timely delivery difficult (Alfaro & Corbett, 2003; Fisher & Ittner, 1999). At specialty retail stores, operational experiences of fulfillment processes for products can be easily applied to similar products in related product categories and operational difficulties during the fulfillment process can often be effectively mitigated (Hult, Ketchen & Nichols, 2003). As a result, consumers may have a low expectation of general retail stores' order fulfillment process, but a high expectation of specialty retail stores' order fulfillment process.

The e-business strategy literature highlights the importance of integrating consumer expectations into the configuration of order procurement and fulfillment processes (Boyer & Hult, 2005; Thirumalai & Sinha, 2005). In light of these important observations, this research is designed to investigate how consumer expectations of an online retailer's procurement and fulfillment processes--indicated by the number of product categories offered--would affect the contributions of consumer satisfaction with order procurement and fulfillment process toward consumer repurchase intention. Specifically, this research intends to address the following main research question: How does the number of product categories carried by online retailers moderate the relationships between consumer satisfaction with (1) order procurement and (2) order fulfillment and consumer repurchase intention? …

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