LAUSR

Purpose To investigate the psychological mechanism of observational learning in the online retailing context, the purpose of this paper is to show how the psychological distance between consumers and products affects modes of observational learning. Design/methodology/approach Five experimental studies are conducted to test the hypotheses. Findings The findings show that which modes of observational learning are adopted by consumers is affected by consumers’ psychological distance. Specifically, when the psychological distance between consumers and products is proximal, consumers tend to adopt the termed adequate observational learning mode by considering the interaction of information about popularity and the breadth of appeal of a product to make purchase. However, when the psychological distance is distal, consumers would consider information of popularity and breadth of appeal separately without considering the interaction, termed as inadequate observational learning mode. The observed relationship between psychological distance and observational learning mode could be explained by the construal level. Research limitations/implications This research advances the observational learning and psychological distance literature by investigating the psychological mechanism behind observational learning modes. Limitations include the use of scenario-based experiments to test the hypotheses, investigation of a single product attribute (i.e. breadth of appeal) and assessment of popularity information by sales volume alone. Practical implications The current research provides a deeper understanding of consumer observational learning modes, which can help online retailers to develop effective product strategies and marketing tactics and, finally, achieve stronger competitive positions. Originality/value The present research contributes to the literature by examining the psychological mechanism involved in observational learning. This research distinguishes adequate and inadequate observational learning modes from the perspective of psychological distance.