The Effects of Differential Textbook Pricing: Online Versus In Store

Abstract

The pricing of textbooks has been complicated by the Internet. Should the price be the same both online and in store? Should the price be lower over the Internet? If so, how much lower? And if it is lower, will that affect the campus bookstore's reputation? The results of the present study suggest that lower prices online will have no negative effect on the bookstore's reputation, partly because students expect online prices to be lower and partly because the reputation of campus bookstores is already low. Although students are generally trusting, they trust neither the bookstore nor the publisher. Students do, however, recognize that the bookstore is fast and convenient, and nearly a third say they would purchase textbooks in store even if online prices were cheaper. In addition, there is evidence that in actual practice fewer students would take advantage of cheaper online sales than those who say they will. Furthermore, those who would purchase online are probably already doing so. Consequently, it appears that providing a discount online would capture the price-sensitive student segment without jeopardizing in-store sales or reputation.