Understanding the Choice of Online Resale Channel for Used Electronics

Abstract

Each year, global consumers dispose of 20 million–50 million tons of electronic products, including laptops, tablets, and, most commonly, cell phones. Realizing the residual value in used electronics, consumers frequently look for ways to sell their devices, whereas independent parties (IPs) such as Gazelle and NextWorth and original equipment manufacturers (OEMs) such as Apple compete in acquiring them. These firms also compete with online marketplaces such as eBay, which offer a channel for individuals to sell used devices to others. To succeed in this highly competitive market, buying firms (i.e., OEMs and IPs) must understand factors that influence sellers’ estimated utility and their decisions in a resale process. We conduct laboratory experiments with a two‐stage resale process, where subjects in the first stage choose a resale channel to sell their used cell phone. In the second stage, subjects evaluate a potential counteroffer decision, that is, post‐choice decision. Our results from the resale‐channel choice stage show that individuals have a higher sensitivity to price, time until payment, and online ratings when selling to an IP than when selling to an OEM or through an OM. No significant difference exists, however, in their sensitivity to IP or OEM data security policies. Our results from the post‐choice decision stage show that a seller's share in the counteroffer increases the likelihood of acceptance in all resale channels, whereas higher online ratings might increase or decrease the likelihood of accepting a counteroffer depending on the resale channel. Our laboratory experiment results generally are consistent, with some differences, when replicated on Amazon's Mechanical Turk (MTurk).

Secondhand product quality disclosure strategy of the retailer under different supply chain structures

“…Shen et al (2020) examine the value of blockchain for secondhand products in a SC. Esenduran et al (2020) focus on online resale channels of secondhand electronic products and find that price, time until payment, and online ratings are sensitive considerations for consumers to sell secondhand products through an online platform. Different from the above literature, we study the effect of quality disclosure strategies for secondhand products on players.…”

“…With the rapid replacement of electronic products and changes in consumer awareness, especially the development of the secondary market and the sinking market (Esenduran et al, 2020;Shulman & Coughlan, 2007), retailers are increasingly introducing secondhand products while continuing to resell new products supplied by manufacturers. According to a projection by the LeadLeo Research Institute, a market research provider, sales of secondhand products last year in China were expected to reach 1.04 trillion yuan ($160 billion), an increase of 17.7% over the previous year (Wenqian, 2021).…”

“…Given the prevalence of quality information disclosure in industrial operations in practice (Esenduran et al, 2020;Shen et al, 2020), these conditions are appropriate and contribute to the SC management community. Third, we investigate the manufacturer and the retailer's equilibrium decisions regarding the channel strategy and quality disclosure strategy of secondhand products.…”

Consumption Motivation of Limited Edition Product in Reselling Open Market

“…With regard to limited edition products, consumers may buy such products merely to use them, but also the purchaser often tends to act as a reseller. Accordingly, analyzing repurchase intentions or trends of continuous consumption attitudes merely based on the level of purchase satisfaction has limitations in terms of limited edition product consumption behaviors [70,71]. Thus, on the basic assumptions of emotional satisfaction with purchasing highly rare limited edition products, positive experience of consumption behaviors in terms of social and economic values, and characteristics and motivations of limited edition product purchases that may involve future values because they can be resold, this study presents the following hypothesis regarding the expectation that resulting active consumption attitudes will lead to continued consumption activity; Hypothesis 6 (H6).…”

Revenue management in a refurbishing duopoly with cannibalization

“…By examining cannibalization and cross‐cannibalization effects, through several behavioral experiments that incorporate product condition, discount, and brand variables, we answer this question and also extend current theory. In particular, prior studies tend to investigate refurbishing strategies in monopolistic settings, using factors such as product category/type (Abbey, Meloy, et al, 2015; Guide Jr & Li, 2010; Zhou & Gupta, 2020), seller identity (Agrawal, Singh, et al, 2015; Esenduran et al, 2020; Subramanian & Subramanyam, 2012), product condition (Neto et al, 2016), brand equity (Agrawal, Singh, et al, 2015), perceived quality (Abbey et al, 2017, 2019), and price discounts (Abbey, Blackburn, et al, 2015; Ovchinnikov, 2011), but we find limited research in competitive settings. In a few available studies, Ovchinnikov et al (2014) acknowledge competition between high‐end and low‐end segments, and Raz et al (2017) consider the outcomes of competition between firms that provide products in combination with a service.…”