Tweeting as a marketing tool: A field experiment in the TV industry

Authors Gong, Zhang, Zhao, Jiang
Journal Journal of Marketing Research
Year 2017
Type Published Paper
Abstract Many businesses today have adopted tweeting as a new form of product marketing. However, whether and how tweeting affects product demand remains inconclusive. The authors explore this question using a randomized field experiment on Sina Weibo, the top tweeting website in China. The authors collaborate with a major global media company and examine how the viewing of its TV shows is affected by (1) the media company's tweets about its shows, and (2) recruited Weibo influentials' retweets of the company tweets. The authors find that both company tweets and influential retweets increase show viewing, but in different ways. Company tweets directly boost viewing, whereas influential retweets increase viewing if the show tweet is informative. Meanwhile, influential retweets are more effective than company tweets in bringing new Weibo followers to the company, which indirectly increases viewing. The authors discuss recommendations on how to manage tweeting as a marketing tool.
Keywords Tweet, social media marketing, social media return on investment, field experiment, television
URL https://doi.org/10.1509/jmr.14.0348
Tags Archival Empirical  |   Consumer Decisions  |   Manager / Firm Behavior  |   Media and Textual Analysis

How language shapes word of mouth's impact

Authors Packard, Berger
Journal Journal of Marketing Research
Year 2017
Type Published Paper
Abstract Word of mouth affects consumer behavior, but how does the language used in word of mouth shape that impact? Might certain types of consumers be more likely to use certain types of language, affecting whose words have more influence? Five studies, including textual analysis of more than 1,000 online reviews, demonstrate that compared to more implicit endorsements (e.g., "I liked it," "I enjoyed it"), explicit endorsements (e.g., "I recommend it") are more persuasive and increase purchase intent. This occurs because explicit endorsers are perceived to like the product more and have more expertise. Looking at the endorsement language consumers actually use, however, shows that while consumer knowledge does affect endorsement style, its effect actually works in the opposite direction. Because novices are less aware that others have heterogeneous product preferences, they are more likely to use explicit endorsements. Consequently, the endorsement styles novices and experts tend to use may lead to greater persuasion by novices. These findings highlight the important role that language, and endorsement styles in particular, plays in shaping the effects of word of mouth.
Keywords Word of mouth, language, persuasion, consumer knowledge, social perception
URL https://doi.org/10.1509/jmr.15.0248
Tags Archival Empirical  |   Consumer Decisions  |   Media and Textual Analysis  |   Social Transmission Biases

Does online word-of-mouth increase demand? (and how?) Evidence from a natural experiment

Authors Seiler, Yao, Wang
Journal Marketing Science
Year 2017
Type Published Paper
Abstract We leverage a temporary block of the Chinese microblogging platform Sina Weibo due to political events to estimate the causal effect of online word-of-mouth content on product demand in the context of TV show viewership. Based on this source of exogenous variation, we estimate an elasticity of TV show ratings (market share in terms of viewership) with respect to the number of relevant comments (comments were disabled during the block) of 0.016. We find that more postshow microblogging activity increases demand, whereas comments posted prior to the show airing do not affect viewership. These patterns are inconsistent with informative or persuasive effects and suggest complementarity between TV consumption and anticipated postshow microblogging activity.
Keywords Microblogging, advertising, social media, word of mouth
URL https://pubsonline.informs.org/doi/abs/10.1287/mksc.2017.1045?casa_token=lxxq5FpqeeYAAAAA:wXJbLLGEETzSUvKZeU-YY5LI26G3TkYo9IMD1j6sOlCDOgwPNrrscJ-3k5Nj5Cm9pe5mi7ArVvpq
Tags Archival Empirical  |   Consumer Decisions  |   Media and Textual Analysis

Narrative economics

Authors Shiller
Journal American Economic Review
Year 2017
Type Published Paper | Literature Review Paper
Abstract This address considers the epidemiology of narratives relevant to economic fluctuations. The human brain has always been highly tuned toward narratives, whether factual or not, to justify ongoing actions, even such basic actions as spending and investing. Stories motivate and connect activities to deeply felt values and needs. Narratives "go viral" and spread far, even worldwide, with economic impact. The 1920-1921 Depression, the Great Depression of the 1930s, the so-called Great Recession of 2007-2009, and the contentious political-economic situation of today are considered as the results of the popular narratives of their respective times. Though these narratives are deeply human phenomena that are difficult to study in a scientific manner, quantitative analysis may help us gain a better understanding of these epidemics in the future.
Keywords Narrative, social psychology, social epidemics, economic behaviors
URL https://www.aeaweb.org/articles?id=10.1257%2Faer.107.4.967&msclkid=bd5677ccaa8411ec80ac1e25c5639856
Tags Asset Pricing, Trading Volume and Market Efficiency  |   Financing- and Investment Decisions (Individual)  |   Media and Textual Analysis  |   Propagation of Noise / Undesirable Outcomes

Social networks and housing markets

Authors Baily, Cao, Kuchler, Stroebel
Year 2016
Type Working Paper
Abstract We document that the recent house price experiences within an individual's social network affect her perceptions of the attractiveness of property investments, and through this channel have large effects on her housing market activity. Our data combine anonymized social network information from Facebook with housing transaction data and a survey. We first show that in the survey, individuals whose geographically-distant friends experienced larger recent house price increases consider local property a more attractive investment, with bigger effects for individuals who regularly discuss such investments with their friends. Based on these findings, we introduce a new methodology to document large effects of housing market expectations on individual housing investment decisions and aggregate housing market outcomes. Our approach exploits plausibly-exogenous variation in the recent house price experiences of individuals' geographically-distant friends as shifters of those individuals' local housing market expectations. Individuals whose friends experienced a 5 percentage points larger house price increase over the previous 24 months (i) are 3.1 percentage points more likely to transition from renting to owning over a two-year period, (ii) buy a 1.7 percent larger house, (iii) pay 3.3 percent more for a given house, and (iv) make a 7% larger downpayment. Similarly, when homeowners' friends experience less positive house price changes, these homeowners are more likely to become renters, and more likely to sell their property at a lower price. We also find that when individuals observe a higher dispersion of house price experiences across their friends, this has a negative effect on their housing investments. Finally, we show that these individual-level responses aggregate up to affect county-level house prices and trading volume. Our findings suggest that the house price experiences of geographically-distant friends might provide a valid instrument for local house price growth.
Keywords House price, social contagion, investor behaviors, market expectation
URL https://www.nber.org/papers/w22258
Tags Archival Empirical  |   Asset Pricing, Trading Volume and Market Efficiency  |   Experimental / Survey-Based Empirical  |   Financing- and Investment Decisions (Individual)  |   Media and Textual Analysis  |   Social Network Structure

Sharing with friends versus strangers: How interpersonal closeness influences word-of-mouth valence

Authors Dubois, Bonezzi, Angelis
Journal Journal of Marketing Research
Year 2016
Type Published Paper
Abstract How does interpersonal closeness (IC)--the perceived psychological proximity between a sender and a recipient--influence word-of-mouth (WOM) valence? The current research proposes that high levels of IC tend to increase the negativity of WOM shared, whereas low levels of IC tend to increase the positivity of WOM shared. The authors hypothesize that this effect is due to low versus high levels of IC triggering distinct psychological motives. Low IC activates the motive to self-enhance, and communicating positive information is typically more instrumental to this motive than communicating negative information. In contrast, high IC activates the motive to protect others, and communicating negative information is typically more instrumental to this motive than communicating positive information. Four experiments provide evidence for the basic effect and the underlying role of consumers' motives to self-enhance and protect others through mediation and moderation. The authors discuss implications for understanding how WOM spreads across strongly versus weakly tied social networks.
Keywords Word of mouth, word-of-mouth valence, interpersonal closeness, self-enhancement, social media
URL https://doi.org/10.1509/jmr.13.0312
Tags Consumer Decisions  |   Experimental / Survey-Based Empirical  |   Media and Textual Analysis  |   Social Network Structure

Estimating peer effects in networks with peer encouragement designs

Authors Eckles, Kizilcec, Bakshy
Journal Proceedings of the National Academy of Sciences of the United States of America
Year 2016
Type Published Paper
Abstract Peer effects, in which the behavior of an individual is affected by the behavior of their peers, are central to social science. Because peer effects are often confounded with homophily and common external causes, recent work has used randomized experiments to estimate effects of specific peer behaviors. These experiments have often relied on the experimenter being able to randomly modulate mechanisms by which peer behavior is transmitted to a focal individual. We describe experimental designs that instead randomly assign individuals' peers to encouragements to behaviors that directly affect those individuals. We illustrate this method with a large peer encouragement design on Facebook for estimating the effects of receiving feedback from peers on posts shared by focal individuals. We find evidence for substantial effects of receiving marginal feedback on multiple behaviors, including giving feedback to others and continued posting. These findings provide experimental evidence for the role of behaviors directed at specific individuals in the adoption and continued use of communication technologies. In comparison, observational estimates differ substantially, both underestimating and overestimating effects, suggesting that researchers and policy makers should be cautious in relying on them.
Keywords Social interactions, social networks, causal inference, experimental design
URL https://doi.org/10.1073/pnas.1511201113
Tags Archival Empirical  |   Experimental / Survey-Based Empirical  |   Media and Textual Analysis

Peer pressure: Social interaction and the disposition effect

Authors Heimer
Journal Review of Financial Studies
Year 2016
Type Published Paper
Abstract Social interaction contributes to some traders' disposition effect. New data from an investment-specific social network linked to individual-level trading records builds evidence of this connection. To credibly estimate causal peer effects, I exploit the staggered entry of retail brokerages into partnerships with the social trading web platform and compare trader activity before and after exposure to these new social conditions. Access to the social network nearly doubles the magnitude of a trader's disposition effect. Traders connected in the network develop correlated levels of the disposition effect, a finding that can be replicated using workhorse data from a large discount brokerage.
URL https://doi.org/10.1093/rfs/hhw063
Tags Archival Empirical  |   Financing- and Investment Decisions (Individual)  |   Media and Textual Analysis

The positivity bias and prosocial deception on facebook

Authors Spottswood, Hancock
Journal Computers in Human Behavior
Year 2016
Type Published Paper
Abstract Can the positivity bias, observed across various Social Network Sites (SNSs), predict the use of prosocial lies in a SNS such as Facebook? The positivity bias may be a product of politeness norms (i.e., positive face concern) that have influenced communication phenomena before these sites existed. In addition, positive face concern may also be affected by unconscious cues or primes that promote prosocial behavior on Facebook. We conducted an online experiment using current Facebook users to examine how positive face concern and surveillance primes affect prosocial lying in public and private Facebook contexts. Although positive face concern and publicness predicted the use of prosocial lying, positive face concern was not affected by the publicness and surveillance primes did not affect positive face concern or the use of prosocial lies in our study. This hints towards the nuance of positive face concern and the potential limitations of surveillance primes on prosocial lying behavior.
Keywords Facebook, deception, positive face, surveillance primes
URL https://doi.org/10.1016/j.chb.2016.08.019
Tags Experimental / Survey-Based Empirical  |   Media and Textual Analysis  |   Social Transmission Biases

News, politics, and negativity

Authors Soroka, McAdams
Journal Political Communication
Year 2015
Type Published Paper
Abstract Work in political communication has discussed the ongoing predominance of negative news, but has offered few convincing accounts for this focus. A growing body of literature shows that humans regularly pay more attention to negative information than to positive information, however. This article argues that we should view the nature of news content in part as a consequence of this asymmetry bias observed in human behavior. A psychophysiological experiment capturing viewers' reactions to actual news content shows that negative news elicits stronger and more sustained reactions than does positive news. Results are discussed as they pertain to political behavior and communication, and to politics and political institutions more generally.
Keywords Negativity bias, mass media, political communication, psychophysiology
URL https://doi.org/10.1080/10584609.2014.881942
Tags Consumer Decisions  |   Experimental / Survey-Based Empirical  |   Media and Textual Analysis  |   Social Transmission Biases

Word of mouth and interpersonal communication: A review and directions for future research

Authors Berger
Journal Journal of Consumer Psychology
Year 2014
Type Published Paper | Literature Review Paper
Abstract People often share opinions and information with their social ties, and word of mouth has an important impact on consumer behavior. But what drives interpersonal communication and why do people talk about certain things rather than others? This article argues that word of mouth is goal driven and serves five key functions (i.e., impression management, emotion regulation, information acquisition, social bonding, and persuasion). Importantly, I suggest these motivations are predominantly self- (rather than other) serving and drive what people talk about even without their awareness. Further, these drivers make predictions about the types of news and information people are most likely to discuss. This article reviews the five proposed functions and well as how contextual factors (i.e., audience and communication channel) may moderate which functions play a larger role. Taken together, the paper provides insight into the psychological factors that shape word of mouth and outlines additional questions that deserve further study.
URL https://doi.org/10.1016/j.jcps.2014.05.002
Tags Archival Empirical  |   Consumer Decisions  |   Experimental / Survey-Based Empirical  |   Media and Textual Analysis  |   Social Transmission Biases

Wisdom of crowds: The value of stock opinions transmitted through social media

Authors Chen, De, Hu, Hwang
Journal The Review of Financial Studies
Year 2014
Type Published Paper
Abstract Social media has become a popular venue for individuals to share the results of their own analysis on financial securities. This paper investigates the extent to which investor opinions transmitted through social media predict future stock returns and earnings surprises. We conduct textual analysis of articles published on one of the most popular social media platforms for investors in the United States. We also consider the readers' perspective as inferred via commentaries written in response to these articles. We find that the views expressed in both articles and commentaries predict future stock returns and earnings surprises.
URL https://academic.oup.com/rfs/article-abstract/27/5/1367/1581938
Tags Archival Empirical  |   Asset Pricing, Trading Volume and Market Efficiency  |   Media and Textual Analysis

Consumer demand for cynical and negative news frames

Authors Trussler, Soroka
Journal International Journal of Press/Politics
Year 2014
Type Published Paper
Abstract Commentators regularly lament the proliferation of both negative and/or strategic ("horse race") coverage in political news content. The most frequent account for this trend focuses on news norms and/or the priorities of news journalists. Here, we build on recent work arguing for the importance of demand-side, rather than supply-side, explanations of news content. In short, news may be negative and/or strategy-focused because that is the kind of news that people are interested in. We use a lab study to capture participants' news-selection biases, alongside a survey capturing their stated news preferences. Politically interested participants are more likely to select negative stories. Interest is associated with a greater preference for strategic frames as well. And results suggest that behavioral results do not conform to attitudinal ones. That is, regardless of what participants say, they exhibit a preference for negative news content.
Keywords Negative news, strategy news, negativity bias, horse race, consumer demand, experimental design, gatekeeping
URL https://doi.org/10.1177/1940161214524832
Tags Experimental / Survey-Based Empirical  |   Media and Textual Analysis  |   Social Transmission Biases

Learning from the crowd: Regression discontinuity estimates of the effects of an online review database

Authors Anderson, Magruder
Journal Economic Journal
Year 2012
Type Published Paper
Abstract Internet review forums increasingly supplement expert opinion and social networks in informing consumers about product quality. However, limited empirical evidence links digital word-of-mouth to purchasing decisions. We implement a regression discontinuity design to estimate the effect of positive Yelp.com ratings on restaurant reservation availability. An extra half-star rating causes restaurants to sell out 19 percentage points (49%) more frequently, with larger impacts when alternate information is more scarce. These returns suggest that restaurateurs face incentives to leave fake reviews but a rich set of robustness checks confirm that restaurants do not manipulate ratings in a confounding, discontinuous manner.
Keywords Sports events, media, Olympics, Olympic stocks, retail investors, valuation, fundamentals, comovement, categorization, investor sentiment, investor recognition, common factor, stay-at-home, meme
URL https://doi.org/10.1111/j.1468-0297.2012.02512.x
Tags Archival Empirical  |   Consumer Decisions  |   Manager / Firm Behavior  |   Media and Textual Analysis

What makes online content viral?

Authors Berger, Milkman
Journal Journal of Marketing Research
Year 2012
Type Published Paper
Abstract Why are certain pieces of online content (e.g., advertisements, videos, news articles) more viral than others? This article takes a psychological approach to understanding diffusion. Using a unique data set of all the New York Times articles published over a three-month period, the authors examine how emotion shapes virality. The results indicate that positive content is more viral than negative content, but the relationship between emotion and social transmission is more complex than valence alone. Virality is partially driven by physiological arousal. Content that evokes high-arousal positive (awe) or negative (anger or anxiety) emotions is more viral. Content that evokes low-arousal, or deactivating, emotions (e.g., sadness) is less viral. These results hold even when the authors control for how surprising, interesting, or practically useful content is (all of which are positively linked to virality), as well as external drivers of attention (e.g., how prominently content was featured). Experimental results further demonstrate the causal impact of specific emotion on transmission and illustrate that it is driven by the level of activation induced. Taken together, these findings shed light on why people share content and how to design more effective viral marketing campaigns.
Keywords Word of mouth, viral marketing, social transmission, online content
URL https://doi.org/10.1509/jmr.10.0353
Tags Archival Empirical  |   Consumer Decisions  |   Experimental / Survey-Based Empirical  |   Media and Textual Analysis  |   Social Transmission Biases

When social networking is not working: Individuals with low self-esteem recognize but do not reap the benefits of self-disclosure on facebook

Authors Forest, Wood
Journal Psychological Science
Year 2012
Type Published Paper
Abstract The popular media have publicized the idea that social networking Web sites (e.g., Facebook) may enrich the interpersonal lives of people who struggle to make social connections. The opportunity that such sites provide for self-disclosure-a necessary component in the development of intimacy-could be especially beneficial for people with low self-esteem, who are normally hesitant to self-disclose and who have difficulty maintaining satisfying relationships. We suspected that posting on Facebook would reduce the perceived riskiness of self-disclosure, thus encouraging people with low self-esteem to express themselves more openly. In three studies, we examined whether such individuals see Facebook as a safe and appealing medium for self-disclosure, and whether their actual Facebook posts enabled them to reap social rewards. We found that although people with low self-esteem considered Facebook an appealing venue for self-disclosure, the low positivity and high negativity of their disclosures elicited undesirable responses from other people.
Keywords Social networking, facebook, self-esteem, self-disclosure, interpersonal relationships, social interaction
URL https://doi.org/10.1177/0956797611429709
Tags Experimental / Survey-Based Empirical  |   Media and Textual Analysis

Designing ranking systems for hotels on travel search engines by mining user-generated and crowd sourced content

Authors Ghose, Ipeirotis, Li
Journal Marketing Science
Year 2012
Type Published Paper
Abstract User-generated content on social media platforms and product search engines is changing the way consumers shop for goods online. However, current product search engines fail to effectively leverage information created across diverse social media platforms. Moreover, current ranking algorithms in these product search engines tend to induce consumers to focus on one single product characteristic dimension (e.g., price, star rating). This approach largely ignores consumers' multidimensional preferences for products. In this paper, we propose to generate a ranking system that recommends products that provide, on average, the best value for the consumer's money. The key idea is that products that provide a higher surplus should be ranked higher on the screen in response to consumer queries. We use a unique data set of U.S. hotel reservations made over a three-month period through Travelocity, which we supplement with data from various social media sources using techniques from text mining, image classification, social geotagging, human annotations, and geomapping. We propose a random coefficient hybrid structural model, taking into consideration the two sources of consumer heterogeneity the different travel occasions and different hotel characteristics introduce. Based on the estimates from the model, we infer the economic impact of various location and service characteristics of hotels. We then propose a new hotel ranking system based on the average utility gain a consumer receives from staying in a particular hotel. By doing so, we can provide customers with the "best-value" hotels early on. Our user studies, using ranking comparisons from several thousand users, validate the superiority of our ranking system relative to existing systems on several travel search engines. On a broader note, this paper illustrates how social media can be mined and incorporated into a demand estimation model in order to generate a new ranking system in product search engines. We thus highlight the tight linkages between user behavior on social media and search engines. Our interdisciplinary approach provides several insights for using machine learning techniques in economics and marketing research.
Keywords Gender, conference calls, textual analysis, euphemisms, abnormal returns
URL https://doi.org/10.1287/mksc.1110.0700
Tags Archival Empirical  |   Media and Textual Analysis

Do internet stock message boards influence trading? Evidence from heavily discussed stocks with no fundamental news

Authors Sabherwal, Sarkar, Zhang
Journal Journal of Business Finance & Accounting
Year 2012
Type Published Paper
Abstract This study extends the literature on the information content of stock message boards. To better understand the effect of online postings on trading activities and reduce the error due to stocks with small message board followings, we examine stocks with no fundamental news and high message posting activity. Such stocks tend to be of small firms with weak financials. For those stocks, we find a two-day pump followed by a two-day dump manipulation pattern among online traders, which suggests that an online stock message board can be used as a herding device to temporarily drive up stock prices. We also find that online traders' credit-weighted sentiment index, but not the number of postings, is positively associated with contemporaneous return and negatively predicts the return next day and two days later. Also, absolute sentiment is negatively related with contemporaneous and next day's intraday volatility and positively related with the proportion of volume in small-sized trades. We conclude that message board sentiment is an important predictor of trading-related activities.
Keywords Internet stock message board, online trading, investor sentiment, noise trader, naive bayesian, text classifier
URL https://onlinelibrary.wiley.com/doi/full/10.1111/j.1468-5957.2011.02258.x
Tags Archival Empirical  |   Asset Pricing, Trading Volume and Market Efficiency  |   Financing- and Investment Decisions (Individual)  |   Media and Textual Analysis

The effects of traditional and social earned media on sales: A study of a microlending marketplace

Authors Stephan, Galak
Journal Journal of Marketing Research
Year 2012
Type Published Paper
Abstract Marketers distinguish three types of media: paid (e.g., advertising), owned (e.g., company website), and earned (e.g., publicity). The effects of paid media on sales have been extensively covered in the marketing literature. The effects of earned media, however, have received limited attention. The authors examine how two types of earned media, traditional (e.g., publicity and press mentions) and social (e.g., blog and online community posts), affect sales and activity in each other. They analyze 14 months of daily sales and media activity data from a microlending marketplace website using a multivariate autoregressive time-series model. They find that (1) both traditional and social earned media affect sales; (2) the per-event sales impact of traditional earned media activity is larger than for social earned media; (3) because of the greater frequency of social earned media activity, after adjusting for event frequency, social earned media's sales elasticity is significantly greater than traditional earned media's; and (4) social earned media appears to play an important role in driving traditional earned media activity.
Keywords Social media, short selling, intraday trading, retail investors
URL https://www.jstor.org/stable/41714453
Tags Archival Empirical  |   Financing- and Investment Decisions (Individual)  |   Media and Textual Analysis

A dynamic model of the effect of online communications on firm sales

Authors Sonnier, McAlister, Rutz
Journal Marketing Science
Year 2011
Type Published Paper
Abstract Interpersonal communications have long been recognized as an influential source of information for consumers. Internet-based media have facilitated information exchange among firms and consumers, as well as observability and measurement of such exchanges. However, much of the research addressing online communication focuses on ratings collected from online forums. In this paper, we look beyond ratings to a more comprehensive view of online communications. We consider the sales effect of the volume of positive, negative, and neutral online communications captured by Web crawler technology and classified by automated sentiment analysis. Our modeling approach captures two key features of our data, dynamics and endogeneity. In terms of dynamics, we model daily measures of online communications about a firm and its products as contributing to a latent demand-generating stock variable. To account for the endogeneity, we extend the latent instrumental variable technique to account for dynamic endogenous regressors. Our results demonstrate a significant effect of positive, negative, and neutral online communications on daily sales performance. Failure to account for endogeneity results in a severe attenuation of the estimated effects. From a managerial perspective, we demonstrate the importance of accounting for communication valence as well as the impact of shocks to positive, negative, and neutral online communications.
Keywords Tweet, social media marketing, social media return on investment, field experiment, television
URL https://doi.org/10.1287/mksc.1110.0642
Tags Archival Empirical  |   Consumer Decisions  |   Media and Textual Analysis

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