The Effects of Search-Related and Purchase-Related Mobile App Additions on Retailers’ Shareholder Wealth: The Roles of Firm Size, Product Category, and Customer Segment

• Published in: Journal of retailing Vol. 94; no. 4; pp. 343 - 351
• Main Authors: Cao, Lanlan, Liu, Xin, Cao, Wenbin
• Format: Journal Article
• Language: English
• Published: Greenwich Elsevier Inc 01.12.2018; Elsevier Limited
• Subjects: Channel additions; Customer satisfaction; Event study; Marketing and firm value; Mobile commerce; Multichannel retailing; Retailing industry; Securities markets; Size of enterprise; Stock prices; Studies; United States > US; Mobile commerce; Event study; Marketing and firm value; Channel additions; Multichannel retailing
• ISSN: 0022-4359; 1873-3271
• DOI: 10.1016/j.jretai.2018.08.003

[Display omitted] •Mobile app additions increase retailers’ market values.•Smaller firms benefit more from search-related app additions.•Product retailers benefit more from search-related app additions.•Firms that target younger customers benefit less from purchase-related app additions. Mobile channel additions have been shown to increase consumer-brand relationships, brand satisfaction towards and overall purchasing from a retailer, but what is less apparent is whether shareholders are fully rewarded for retailers’ mobile channel additions. Results from an event study on 115 announcements relating to mobile app additions of publicly traded U.S. retail firms between 2009 and 2016 indicate that the stock market responds generally positively to mobile app additions, but specifically to the two mobile app addition types. Stock market responses to search-related and purchase-related app additions are moderated by firm size, product category, and target customer age. For announcements of search-related apps, the market responds more positively to product retailers than to service retailers, and to small firms than large ones. For announcements of purchase-related apps, the market responds less positively to firms that target younger customers than firms who do not especially target them.