In this research, we investigate how sponsored listings on an online search engine influence the consumer’s final decision choices. In an era of digital transformation where companies very often opt for sponsored advertisements, we explore how an anchoring effect (exacerbated by other factors) impacts the evaluation process and final outcome. More specifically, using a mix of secondary data from a large hotel aggregator and experiments, this work empirically validates that sponsored results (i.e., the first paid result) on a search engine results page indeed acts as an anchor. In addition, we find evidence the anchoring effect increases as a) the results are more versus less homogeneous, and b) the screen size of the search device is larger. What’s more, the anchoring effect is largely stable and does not fluctuate based on the category or decision importance. The effect also remains intact whether or not search engine results are randomized through the history of the browser. We also find the anchor influences subsequent evaluations, and options similar to the anchor are more likely to be chosen irrespective of the anchor’s attractiveness despite industry convention that consumers ignore sponsored results (see Henderson 2019) and research indicating consumers routinely select organic over sponsored search results.

• Abhimanyu Bhattacharya(University of Alabama, USA)
• Stacey Robinson(University of Alabama, USA)
• Satadruta Mookherjee(Grenoble Ecole de Management, France)
• Herman Blote(PWC, Netherlands)