Group-buying (GB) deals entail a two-phase decision process. First,
consumers decide whether to buy a deal. Second, they decide when to
redeem the deal, conditional on purchase. Guided by theories of social
influence and observational learning, the authors develop a framework
predicting that (1) deal popularity increases consumers' purchase
likelihood and decreases redemption time, conditional on purchase, and
(2) the social influence-related factors of referral intensity and group
consumption amplify these effects. The authors test this framework and
support it using a unique data set of 30,272 customers of a GB website
with several million data points. Substantially, these findings reveal a
two-phase perspective of GB, longevity effects of deal popularity, and
the amplifying role of customer referrals (influencing others) in the
effects of deal popularity (others' influence). In light of the
criticism of GB industry practice, this study builds the case for GB
websites and merchants to heed deal popularity information and the
social influence-related contingencies. [ABSTRACT FROM AUTHOR]