【Time】December 16, 2016, 13:30 – 14:30 (Friday)

【Venue】Room N510, Shunde Building 

【Title】Learning from Inventory Availability Information: Field Evidence from Amazon

【Speaker】Dr.Ruomeng Cui,Indiana University

【Host】Prof.Simin Huang

【Abstract】Many online retailers provide real-time inventory availability information. Customers can learn from the inventory level and update their beliefs about product quality. Thus, consumer purchasing behavior may be impacted by the availability information. Based on a unique setting from Amazon lightning deals, which displays the percentage of inventory consumed in real time, we explore whether and how consumers learn from inventory availability information. Identifying the e ect of learning on consumer decisions has been a notoriously di cult empirical question due to endogeneity concerns. We address this issue by running a randomized eld experiment on Amazon. In our experiment, we create exogenous shocks on the inventory availability information to a random subset of Amazon lightning deals. In addition, we track the dynamic purchasing behavior and inventory information for 23,665 lightning deals o ered by Amazon in August 2016 and exploit their panel structure to further explore the underlying mechanisms behind learning. We nd evidence of consumer learning from inventory information: a decrease in product availability causally attracts more sales in the future; in particular, a 10% increase in past sales leads to a 2.08% increase in cart add-ins in the next hour. Moreover, we show that buyers use observable product characteristics to moderate their inferences when learning from others, and customers primarily learn about the deal‘s value rather than the product quality from the availability information. 

【Bio】Ruomeng Cui is an assistant professor in the Department of Operations Decision and Technologies at Kelley School of Business, Indiana University. She received her Ph.D. in operations management from the Kellogg School of Management, Northwestern University in 2014. She received her B.S. degree from industrial engineering department at Tsinghua University in 2009. Prof. Cui‘s primary research interests are supply chain management, information sharing, retail operations and consumer behavior.

All interested are welcome!