Are the Time-Poor Willing to Pay More for Online Grocery Services? When ‘No’ Means ‘Yes’

Abstract

This paper investigates consumers’ willingness to pay (WTP) for click-and-collect grocery services. In particular, we analyze whether the time-pressed are willing to pay higher fees. We exploit a survey among 572 customers of two Belgian supermarket chains—both users and non-users. We test our model for three (increasingly narrow) samples: all respondents, respondents with a non-zero WTP, and current users. Our key finding relates to the latter sample. Surprisingly, if we use the WTP measure put forward in the literature, the answer to our research question is ‘no’: we find no significant relationship between users’ perceived time pressure and the maximum service cost per order they are willing to pay. However, on closer scrutiny this ‘no’ in fact means ‘yes’: our finding implies that in the face of increasing fees the time-pressed are willing to maintain their current, higher order frequency for as long as the other users. The maximum total cost they are willing to incur over a given period is thus higher. This said, the absence of a relationship between time pressure and the WTP per order does limit the opportunities for e-grocers to price discriminate, as is suggested in the literature. A further complication is that we find no clear pattern between perceived time pressure and the use of specific time slots.

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