The Effects of Multimedia Communication on Web-Based Negotiation

With the rapid growth of electronic commerce, there is growing demand forremote online negotiations. Although the Internet now enables audio and video communication, most Web-based negotiation systems are still text-based. There is, however, a lack of research on the effects of multimedia on remote negotiations. In this paper, we present a theoretical model to investigate the impacts of multimedia communication in an online negotiation setting. The constructs in our model include communication efficiency, communication effectiveness, and positive and negative social-emotional communication. Through a simulated house purchasing negotiation experiment, we study how different multimedia combinations (text only; text with audio; text with audio and video) affect our constructs and thus further influence negotiation results. Our results showed that both text with audio and text with audio and video communication were significantly preferred to text alone. However, the addition of video to text and audio communication in a negotiation environment was not found to be beneficial. It did not significantly improve communication efficiency, effectiveness or positive social-emotional communication, but distracted negotiators from focusing on the negotiation task. Our analysis also revealed that the communication efficiency construct did not correlate with the perceived success of the negotiation solution; however communication effectiveness and social-emotional communication did correlate with negotiation satisfaction.