Rationality manipulation during consumer decision-making process: an analysis of Alibaba’s online shopping carnival

Alibaba's annual online shopping carnival is well known for being one of the most successful promotion campaigns, during which marketers often deliver as many informational incentives and promotion activities as possible to inspire consumers' fanatical participation and purchases. Nonetheless, there is a dearth of studies that examined the effect of such rationality manipulation on consumers decision-making process using real-world behavioral evidence, which gives us an opportunity to make up for this research gap. Using a unique shopping log dataset generated by consumers on the Tmall platform, we regard the promotional activities release date as source of exogenous shock and conduct a regression discontinuity in time design to examine the change in consumers rationality degree during the carnival. The empirical results show that consumers tend to deal with more external cues and be more stick to their original options within a shorter decision cycle during the carnival, which indicates their decreasing rationality degrees and thus verifies the effectiveness of marketers’ rationality manipulation. Interestingly, we also found an in-group bias that such rationality manipulation has different influences on consumer subgroups of different genders and ages. Among them, of particular note is that the consumer group younger than 24 years old not only has the biggest gender difference within the group, but also has the biggest difference with other age groups. Findings emerged from this study will help marketers improve promotion effectiveness and deliver a rational allocation of information resources on the e-commerce platform.