Strategic Determinants of Web Site Traffic in On-Line Retailing

Web site traffic is a necessary condition for success in Internet retailing. This study empirically tests the effects of e-tailer characteristics and site visibility enhancers on Web site traffic, using data on traffic to top e-tailers from the 2000 holiday season. The results, in contradiction to much of the theoretical literature, suggest that order of entry and off-line advertising are not significant Web site traffic drivers. Media presence, however, turns out to be a very important factor. This is an intriguing finding, because many e-tailers that spent a great deal on advertising at the time of data collection were later forced to exit the market. In light of this finding, e-tailers competing for consumer mind share should recognize media coverage as a viable, although less easily achievable, alternative to more expensive advertising campaigns. Other findings include the importance of quasi-commodity products and larger product assortments as traffic drivers in the electronic marketplace.