Designing marketplaces of the artificial with consumers in mind: Four approaches to understanding consumer behavior in electronic environments

Marketers face a myriad of decisions when developing a Web site for e-commerce. In this article, we attempt to organize our current understanding of consumer behavior into streams of research that address the development of marketplaces for the digital economy. We start by characterizing computer-based decision environments as Marketplaces of the Artificial, arguing that the unbundling of product information from products presents many decisions and opportunities for the design of decision environments. We then review four areas of research, identifying themes in each area. These areas are (a) the economics of search, (b) cognitive cost approaches, (c) constructed preference approaches, and (d) phenomenological approaches. We illustrate each approach, highlighting its assumptions and discussing examples of research questions and results.