Christian Barrot

Seeding Strategies for Viral Marketing: An Empirical Comparison

Seeding strategies have strong influences on the success of viral marketing campaigns, but previous studies using computer simulations and analytical models have produced conflicting recommendations about the optimal seeding strategy. This study compares four seeding strategies in two complementary small-scale field experiments, as well as in one real-life viral marketing campaign involving more than 200,000 customers of a mobile phone service provider. The empirical results show that the best seeding strategies can be up to eight times more successful than other seeding strategies. Seeding to well-connected people is the most successful approach because these attractive seeding points are more likely to participate in viral marketing campaigns. This finding contradicts a common assumption in other studies. Well-connected people also actively use their greater reach but do not have more influence on their peers than do less well-connected people.

Optimal Product-Sampling Strategies in Social Networks: How Many and Whom to Target?

Using an agent-based model to study the success of product-sampling campaigns that rely on information about social networks, this paper investigates the essential decisions of which consumers and how many of them to target with free product samples. With an unweighted and a weighted real-world personal communication network, we show that the decision of which consumers to target is more important than that of how many consumers to target. Use of social network information increases profits by at least 32 percent. Companies should use a high-degree targeting heuristic to identify the most influential consumers. Use of social network information increases profit for single-purchase products mainly because it supports targeting more influential consumers and therefore speeds up diffusion throughout the network. For repeat-purchase products, social network information decreases the optimal number of samples and thus the cost of the campaign.

Impact of service pricing on referral behaviour

Purpose – This study seeks to examine the effect of pricing as a marketing instrument to stimulate word‐of‐mouth (WOM) by comparing the influence of two pricing strategies (i.e. a low‐complexity vs a network‐effects tariff) on the referral behaviour.Design/methodology/approach – Using customer data from a German mobile network operator (including information on customer characteristics, referral behaviour, and service usage), the authors develop a logit model.Findings – Surprisingly, the results indicate that it is the low‐complexity tariff that increases the likelihood of referrals and leads to an overall higher referral activity. Despite the lower referral activity, however, the network‐effects tariff generates higher revenues.Research limitations/implications – The results show that companies can use pricing schemes to influence referral behaviour and strongly indicate the need of further research on manageable tools to stimulate word‐of‐mouth marketing.Practical implications – The findings show not on...

Did They Tell Their Friends? - Using Social Network Analysis to Detect Contagion Processes

Social contagion processes such as word-of-mouth (WOM) are widely regarded as key success factors for innovation diffusion. Aspects of these processes have been thoroughly explored in empirical studies on the actor or dyad levels of analysis. While such studies offer valuable insight into the motivations and contents of WOM, they are not able to include social network structures in their analysis. Contagion processes, however, require an underlying social networks infrastructure to unfold their potential for innovation diffusion. Although marketing managers strongly believe in social contagion processes, and studies on both actor and dyad levels strongly suggest their existence, marketing scientists have been unable to find conclusive evidence of such effects in network-level studies, which are most appropriate for this purpose.To address this research gap, we propose a new approach for empirical research in this field: the quantitative determination of communication activity, reach, speed, and epidemicity of observed diffusion processes by using social network analysis. We apply this approach empirically by analyzing anonymized customer data from an innovative telecommunications provider. The resulting social network of adopters, consisting of 55,065 customers and 7.8 million individual phone calls, is analyzed and compared to simulated random networks of similar dimensions. We find strong support for significant social contagion influences on adoption decisions and an epidemic pattern of innovation diffusion.

The Role of Mere Closeness: How Geographic Proximity Affects Social Influence.

Geographic proximity has become increasingly relevant due to the growing number of marketing services that use consumers’ geographic locations, thus increasing the importance of gaining insights from this information. In five studies (both field and experimental), the authors analyze the effect of geographic proximity on social influence and demonstrate that not only social proximity but also perceived homophily can trigger social influence. They find that this effect holds under alternative representations of geographic distance and is confirmed for a range of different services and even for physical goods. Furthermore, the authors show that geographic proximity has a relative effect because the social influence of a closer sender is stronger than that of a more distant sender, regardless of the absolute distances. They present managerially relevant conditions under which the influence of geographic proximity not only is comparable to other types of information such as age or gender but also provides sufficient informational value for customers to offset differences among alternatives (e.g., due to higher prices) in trade-off decisions.

Price elasticities for hardcover and paperback fiction books

Book pricing is problematic for two main reasons. First, because legal restrictions make pricing decisions irreversible. Second, because publishers must set prices for many books every year. Therefore, a sound knowledge of consumer reaction to price is essential for good pricing decisions. Our research examines consumer reactions to prices, provides price elasticities based on a large sample of fiction books, and creates a comprehensive set of quality measures and control variables. Our results show that once price endogeneity is considered, consumers are price elastic. Moreover, we find that the price elasticity for hardcover books is substantially smaller than for paperbacks.

Ethical leadership informs purchasing intentions because of moral self-congruence concerns - PEO Withdrawn (WITHDRAWN)

Ethical leadership has so far mainly been featured in the organizational behavior domain and, as such, treated as an intra- organizational phenomenon. The present study seeks to highlight the relevance of ethical leadership for extra- organizational phenomena by combining the organizational behavior perspective on ethical leadership with a classical marketing approach. In particular, we demonstrate that customers may use perceived ethical leadership cues as additional reference points when forming purchasing intentions. In two experimental studies (N = 601 and N = 336), we find that ethical leadership positively affects purchasing intentions because of customers’ concerns for moral self-congruence. We show this by means of both mediation and moderation analyses. Interestingly, the effect of perceived ethical leadership on purchasing intentions holds over and above the ethical advertising claims (e.g., cause-related marketing) that are commonly used in marketing. We conclude by discussing the possible rami...