An Empirical Study on the Influence of Price Acceptability of Digital Knowledge Goods on Purchase Intention and Site Royalty

Abstract

The purpose of this paper is to investigate what factors affect the price acceptability of Digital Knowledge Goods(DKG), and to find the relationship among consumer's price acceptability, purchase intention, and site royalty. This paper combines the S-O-R (Stimulus-Organization-Response) model with TRA(Theory of Reasoned Action) to predict and explain the DKG consumer behavior. Consumer's perceptions of product or price are stimuli, and the attitude toward behavior is formed in the consumer's mind through the organization process. Attitude, in turn, influences behavioral intentions which is a strong predictor of actual action. The empirical tests proved that product involvement and price fairness perception are very important factors which affect strongly on the price acceptance directly, purchase intention and site royalty indirectly, but price-quality inference schema doesn't work in the DKG market because of intrinsic nature of DKG. This paper also proved the mediating role of purchase intention between consumer's price acceptability and site royalty. The important implication is that Internet marketplace operators need to be more rational and fair in pricing. In the DKG market, sometimes, sale promotion policy would be effective, but that will impair the consumer's price perception. Eventually frequent and repeated sale promotion policy will effect negatively to the customer price acceptability.