Net values

July 7, 2000

The internet may not be the global price-cutting tool it was thought to be, according to a recent study.

Erik Brynjolfsson, associate professor at MIT's Sloan School of Management and co-director of the Centre for eBusiness@ MIT, told a recent London conference that search engines do make it easier for consumers to compare prices among competitors, but online costs fluctuate more than in the physical world.

He said that customers on the web are still willing to pay more for high-quality service and innovation. Professor Brynjolfsson's research found that just 47 per cent of the consumers in the study bought from the lowest-priced seller. Brand familiarity and shipping time scored higher than price.

Details: www.mit.edu

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