Empirical Study of Online Auction Seller Switching: The Case of Yahoo vs. Ruten in Taiwan

Most online auction platform providers (OAPPs) agree that the majority of their profits comes from users, i.e., their buyers and sellers. The major concern of OAPPs is how to gain and lock in users in order to maintain and enhance a competitive edge. Customer switching is one of the primary problems of all companies, including OAPPs. This study focused on online auction sellers and attempted to understand their switching behavior. We developed an integrated model that consisted of OAPP strategies (anti-switching and anti-lock-in), value-based factors (platform qualities and switching costs), lock-in factors (network effects), and perceived values to explore the switching intentions of online auction sellers. The model was tested using a field study of 248 sellers from two online auction websites. The results show that OAPP strategies will affect switching costs which affect perceived value which, in turn, impacts a seller’s switching behavior. Our findings indicate that value-based factors directly influence perceived value which could suitably explain a seller’s decision to switch from one OAPP to another. The study suggests that OAPPs should develop strategies and leverage the network effect to avoid customer switching.