Measuring the effectiveness of e-commerce website design and its impact on business value

This dissertation consists of three essays that offer an in depth analysis of the impact of e-commerce website design. The first essay presents a conceptual framework for understanding the efficacy of systems design for Internet-based selling. Using the conceptualization of online shopping as information processing (i.e., purchase decision making), I characterize the online purchasing process as information foraging, which makes it possible to conceptualize the effectiveness of website design in terms of how well the website enables the consumer to achieve high levels of return on information foraging. I present a framework that identifies purchase decision-making contingencies in the context of three different consumer purchase scenarios. The framework is illustrated and evaluated with reference to mini-cases for each of the purchase scenarios. The results of the mini-case analyses suggest a number of design guidelines for software application development in e-commerce.; The second essay examines the measurement of the effectiveness e-commerce website design. Using production economics as the theoretical basis, I define and model the concept of website efficiency as customer transaction productivity in transforming inputs (e.g., customers actions in interacting with an e-commerce website) into outputs (e.g., checkout of a basket of products). Based on this modeling approach, I propose a full-cycle methodology for measuring website design efficiency from clickstream data using data envelopment analysis (DEA). The value of the proposed methodology is illustrated by applying it to the evaluation of the website of a real-world e-commerce retailer in the online grocery industry.; The third essay validates the above measurement approach by investigating the business value impacts of e-commerce website design. Using econometric and marketing science methods, I empirically assess the business value of website efficiency. Detailed analyses of the performance of customers' website usage from web logs with respect to the customers' purchase transaction histories suggest that effective website usage does in fact lead to value creation in terms of customer value. These impacts were found to be significant above and beyond the impact of customer demographics.