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This research focuses on WWW-based, business-to-consumer retailing. Electronic retailing on the Internet is typically performed through standard online storefronts (e.g., Absolutely Fresh Flowers), specialized online retailers (e.g., Amazon.com), and online megastores (e.g., NetMarket) (Hoffman, Novak and Chatterjee 1996; The Economist 1997). Standard online storefronts offer direct sales of an individual vendor’s range of products. They are similar to “single-source electronic sales channels” as defined by Malone, Yates and Benjamin (1989). Specialized online retailers and online megastores offer cross-organizational or crossnational connections such that they include product offerings from a number of competing sellers. These specialized online retailers and the online megastores correspond to electronic markets as discussed by Malone, Yates and Benjamin. Unlike traditional retailing, WWW-based retail commerce provides consumers with a unique ability to use intelligent agents (comparison-shopping agents) to automate the search for price and other product information across multiple merchants simultaneously (Crowston 1996; Doorenbos, Etzioni, and Weld 1997). The use of such agents has been touted to reduce buyers’ search costs across standard online storefronts, specialized online retailers, and online megastores, and to transform a divers e set of offerings into an economically efficient market (Bakos 1997; Crowston 1996).

Electronic markets and intelligent agents: an experimental study of the economics of electronic commerce