Minxue Huang

Direct and indirect effects of buyers and sellers on search advertising revenues in business-to-business electronic platforms

Platform companies such as Alibaba.com increasingly rely on search advertising as a revenue source. This study examines (1) the direct effect of new and existing buyers and sellers on platform advertising revenue, (2) their indirect effect through two intermediary performance variables (buyers click rate and sellers click price), and (3) how the effects differ between launch and mature stages of the search advertising service. Unique data collected from a leading transactional business-to-business electronic platform suggest that new buyers click on more search advertisements than existing buyers, especially after the firms buyers and sellers have learned and adapted to the service (mature stage). New sellers tend to outbid existing sellers in the mature stage, but the opposite is true when the service is newly introduced (launch stage). Because existing sellers can more effectively send quality signals in the launch stage, attracting existing, rather than new, sellers has a greater effect on click rate in the launch stage; however, the opposite is true in the mature stage. Attracting new buyers also has a greater effect on click rate and price, especially in the mature stage. Finally, using cost data from the platform, this article examines the economic returns of attracting new and existing buyers and sellers with respect to advertising revenue.

Service Quality in Web 2.0 Electronic Commerce: An Integrative Perspective from Typical Service and Technique-Adoption

Compared with Web 1.0, Web 2.0 has many unique characteristics such as real-time, N-N interaction, consumer-participation and rapid spread. However, little literature covers this topic. This paper aims to build a new effective e-commerce service quality system of Web2.0. First, a new service quality system is built based on TAM model and then the relation between the new service quality system and consumer behavior (satisfaction and loyalty) is proved by the survey data. The results suggest that e-commerce service quality evaluation-system of Web2.0 consists of four factors including functional service, interface design, responsiveness and security/privacy, which affect consumer satisfaction indirectly via consumer perceived service quality.

Development and Current Issues Related to Internet Marketing Communications in China

ABSTRACT The Internet has become an essential resource for enterprise development. Its impact on advertising strategy is perhaps the most apparent influence. Since the first network advertisement was placed on Chinabyte in 1994, network advertising has become the third largest industry in the information economy, second only to e-commerce and online games. To understand the current status and development of Chinese online marketing communications, this article briefly introduces three primary aspects: audience characteristics, media types, and subject placement. It also analyzes relevant and compelling issues for China.

Online Relationship Formation

As online shopping evolves from being primarily transactional to being more relational, sellers aim to form online relationships. This article investigates online relationship formation, identifies the performance payoffs that result from forming different types of online relationships (unilateral vs. reciprocal), and tests the most effective relationship-building strategies. Study 1, based on a longitudinal buyer-level analysis of an online shopping community, reveals that buyers use community-, seller-, and buyer-generated signals to identify suitable relationship partners and reduce online shopping risk. These signals generally diminish in importance as buyers gain experience but become more important when buyers are forming reciprocal relationships. Study 2 evaluates the dynamic payoffs of online relationship formation (seller-level analysis) on sales; the effect on sales of reciprocal relationships is three times greater and lasts seven times longer than that of seller-initiated, unilateral relationships. Study 3 is a field experiment testing managerially actionable strategies for leveraging relationships to grow online sales. Tenets arising from differences between online and offline relationships, together with the results from the three studies, inform an emerging theory of online relationships.

The effect of user experience in online games on word of mouth

Online games are now a prosperous industry. Despite the popularity of online games, game developers confront the short life cycle of online games. To tackle this significant challenge, game developers utilize the power of word of mouth (WOM) to diffuse games quickly. However, what influences WOM intention in the context of online games remains unexplored. To address this gap, this study investigates the manner in which three types of experiences, namely, functional, hedonic, and social, influence WOM. Drawing from the pleasurearousaldominance model, the authors propose that user experience leads to WOM by evoking pleasure, arousal, and dominance. Using the survey data collected from online game players, our study reveals that user experience significantly affects consumer intention to spread WOM. Theoretical and managerial implications are discussed. User experience leads to WOM by evoking pleasure, arousal, and dominance.Dominance was the most prominent and significant mediator in the relationship between user experience and WOM.Tenure moderates the effects of user experience on pleasure, arousal, and dominance.Managers could promote the diffusion of online games by enhancing user experience.

People as Transmitters: What Makes an Online Marketing Message Contagious?

Word of Mouth (WOM) has been extensively studied as persuasive communication but it has seldom been studied as diffusive communication. This study focuses on online WOM as diffusive communication and the accompanying associated ripple effect by examining the informationpsilas quality, authenticity, authority, and interestingness. It also investigates how a participantpsilas opinion leadership and seeking propensities influence consumerpsilas online WOM activities. Our results show that all of the four WOM information dimensions have a positive effect on a transmitterpsilas level of acceptance of WOM, which in turn positively affects the transmitterpsilas sharing intention. This study indicates that in computer-mediated environments opinion seekers are more likely to be transmitter.

Can ETailers Benefit from Providing Rich Information

Price competition in electronic markets is intense, and how to obtain positive price premium becomes a hot issue. According to Economics of Information (EOI) theory, eTailers should hide more sensitive information increase search cost and consequently to decrease consumerspsila price sensitivity. In contrast, signal theory suggests that providing rich information is an effective signal for eTailers to enhance consumerspsila trust and purchase intention. This research combines the two competitive theories to explore how eTailerspsila information provision about their products influences consumerspsila cognition and productspsila price premium in electronic markets. The results indicate that providing more information can lead to higher price premium.

Channel Management Through Selective Announcement of Reward and Punishment Decisions

Purpose: Although channel influence strategies such as reward and punishment are useful for firms to manage certain channel partners, the social effect of these strategies has not been examined in the literature. In practice, firms selectively announce their reward and punishment decisions, hoping that these announcements can help encourage or prevent the channel behaviors of other channel members. The main purpose of this article is to provide a theoretical understanding of this business practice in channel management. Methodology: The authors conducted interviews and a scenario experiment with sales managers. The experiment is a 2 (degree of institutionalization: high vs. low) × 2 (power of distributors: powerful vs. less powerful) × 2 (influence strategy: punishment vs. reward) design. Findings: The authors found that firms are more likely to announce their reward decisions than punishment decisions. Also, when institutionalization of marketing channel is low, firms tend to announce all their reward decisions, but they are reluctant to announce their punishment decisions regarding powerful channel members. When institutionalization of marketing channel is high, we find that firms are more likely to announce rewards and punishments regarding less powerful channel members. Contribution: An important contribution of this research is that we are among the first to explore the social effects of power exercise in channel management. We extend the channel power literature by arguing that selective announcements of power exercise (reward and punishment) can influence more channel members. In addition, we combine institutional theory and channel power theory to explain the underlying mechanisms. That is, the degree of institutionalization in marketing channel influences how firms make selective public announcements of their channel decisions.

Consumer Information Search Behavior with Time Tolerance

Based on perceived trust and search time, this paper develops a consumer utility model that describes consumer information search behavior in online retailer. The model reveals that consumer utility is direct proportion to perceived trust in online retailer and inverse proportion to search time. Furthermore, consumer utility increases as search time increases within time threshold, while consumer utility decreases as search time increases. Finally, the time threshold of consumer information search is inverse proportional to price. Keywordsexpected utility; perceived trust; information search; time tolerence

How founders’ social capital affects the success of open-source projects: A resource-based view of project teams

Abstract Volunteers under the open-source paradigm organize themselves and coordinate their efforts through the Internet to develop new products and services. Researchers have recognized open-source project founders’ social capital as an important factor to determine the performance of innovations in the open-source software (OSS) context. This study extends previous research by considering the founders’ social capital as a means to create strategic resources of project teams. We use data collected from an OSS development community to identify the role of founders’ social capital in team resource acquisition and utilization. We also clarify its inconsistent effects on innovation performance. From a resource-based view, we find that team size, as a manifestation of human resources, and team brokerage, as a manifestation of organizational resources, are determined by the social capital of project founders, and, in turn, have effects on innovation performance. However, team size and team brokerage contribute differently to innovation performance. The findings enrich our understanding of the impact of founders’ social capital in OSS communities and provide OSS project leaders and firm managers with guidelines on boosting their chances for successful projects.