Ramkumar Janakiraman

The effect of customers' social media participation on customer visit frequency and profitability: an empirical investigation

In this study we examine the effect of customers’ participation in a firm’s social media efforts on the intensity of the relationship between the firm and its customers as captured by customers’ visit frequency. We further hypothesize and test for the moderating roles of social media activity and customer characteristics on the link between social media participation and the intensity of customer-firm relationship. Importantly, we also quantify the impact of social media participation on customer profitability. We assemble a novel data set that combines customers’ social media participation data with individual customer level transaction data. To account for endogeneity that could arise because of customer self-selection, we utilize the propensity score matching technique in combination with difference in differences analysis. Our results suggest that customer participation in a firm’s social media efforts leads to an increase in the frequency of customer visits. We find that this participation effect is greater when there are high levels of activity in the social media site and for customers who exhibit a strong patronage with the firm, buy premium products, and exhibit lower levels of buying focus and deal sensitivity. We find that the above set of results holds for customer profitability as well. We discuss theoretical implications of our results and offer prescriptions for managers on how to engage customers via social media. Our study emphasizes the need for managers to integrate knowledge from customers’ transactional relationship with their social media participation to better serve customers and create sustainable business value.

How Customer Portfolio Affects New Product Development in Technology- Based Entrepreneurial Firms

This article focuses on how the customer portfolios of technology-based entrepreneurial firms affect new product development. Drawing on knowledge-based, resource dependence, and relational theories, the authors argue that the impact of a firms customers on new product development depends on the size and relational embeddedness of the customer portfolio and the extent to which the firm is dependent on one or a few dominant customers for a majority of its revenues. The authors test the research model using longitudinal data on young firms operating in business-to-business markets in six technology-based industries. The results indicate that customer portfolio size has an inverse U-shaped relationship to the number of new products developed and that the more relationally embedded the customer set, the more new products the firm develops. Dependence stemming from revenue concentration has a negative impact on new product output. Furthermore, the authors find that relational embeddedness can compensate for too small of a customer portfolio and can help offset the negative effects of a highly concentrated portfolio. These results make important theoretical and empirical contributions to the new product development literature, helping uncover some of the antecedents of innovative productivity particularly relevant for young, technology-based firms. The results also contribute to the broader discourse on how customers affect new product development.

From Social to Sale: The Effects of Firm Generated Content in Social Media on Customer Behavior

Given the unprecedented reach of social media, firms are increasingly relying on it as a channel for marketing communication. The objective of this study is to examine the effect of firm-generated content (FGC) in social media on three key customer metrics: spending, cross-buying, and customer profitability. The authors further investigate the synergistic effects of FGC with television advertising and e-mail communication. To accomplish their objectives, the authors assemble a novel data set comprising customers’ social media participation data, transaction data, and attitudinal data obtained through surveys. The results indicate that after the authors account for the effects of television advertising and e-mail marketing, FGC has a positive and significant effect on customers’ behavior. The authors show that FGC works synergistically with both television advertising and e-mail marketing and also find that the effect of FGC is greater for more experienced, tech-savvy, and social media–prone customers. They propose and examine the effect of three characteristics of FGC: valence, receptivity, and customer susceptibility. The authors find that whereas all three components of FGC have a positive impact, the effect of FGC receptivity is the largest. The study offers critical managerial insights regarding how to leverage social media for better returns.

Patients’ Commitment to Their Primary Physician and Why It Matters

PURPOSE The patient-physician relationship is the cornerstone of health care service delivery. The objectives of this study were to assess the contribution of relationship commitment along with trust to patient-physician relationships and to evaluate the association of commitment and trust with adherence to medical advice and healthy eating behaviors. METHODS To test the proposed model, we developed a questionnaire that included both existing scales and a scale constructed specifically for the study; the questions addressed trust, commitment, adherence to physicians’ medical recommendations, and healthy eating behavior. The questionnaire was given to adult patients in the waiting rooms of 4 large clinics in central Texas. RESULTS A total of 1,008 patients returned questionnaires; 869 patients’ questionnaires were complete and used in the analysis. A 3-stage least squares analysis that tested a system of 4 equations which included relationship commitment yielded a systemwide R2 of 0.71 that was 0.09 higher than a system of equations excluding relationship commitment. Trust and commitment were positively associated with adherence (P <.001 and P = .02, respectively). We also found positive relationships between adherence and commitment and between trust and commitment (P <.001 for each). Adherence and commitment were both associated with healthy eating behavior as well (P <.001 for each). CONCLUSIONS Patients’ trust in their physician and commitment to the relationship offer a more complete understanding of the patient-physician relationship. In addition, trust and commitment favorably influence patients’ health behaviors.

The Impact of Automation of Systems on Medical Errors: Evidence from Field Research

We use panel data from multiple wards from two hospitals spanning a three-year period to investigate the impact of automation of the core error prevention functions in hospitals on medical error rates. Although there are studies based on anecdotal evidence and self-reported data on how automation impacts medical errors, no systematic studies exist that are based on actual error rates from hospitals. Further, there is no systematic evidence on how incremental automation over time and across multiple wards impacts the rate of medical errors. The primary objective of our study is to fill this gap in the literature by empirically examining how the automation of core error prevention functions affects two types of medical errors. We draw on the medical informatics literature and principal-agency theory and use a unique panel data set of actual documented medical errors from two major hospitals to analyze the interplay between automation and medical errors. We hypothesize that the automation of the sensing function (recording and observing agent actions) will have the greatest impact on reducing error rates. We show that there are significant complementarities between quality management training imparted to hospital staff and the automation of control systems in reducing interpretative medical errors. We also offer insights to practitioners and theoreticians alike on how the automation of error prevention functions can be combined with training in quality management to yield better outcomes. Our results suggest an optimal implementation path for the automation of error prevention functions in hospitals.

Perception Spillovers Across Competing Brands: A Disaggregate Model of How and When

Drawing on the accessibility–diagnosticity framework and previous literature on branding and order of entry, the authors hypothesize that perception spillovers can also occur across directly competing products that do not share a common brand name. The authors suggest two mechanisms (prior perception spillover and dynamic perception spillover) and one moderating variable (product/brand similarity). To test for spillovers across competing brands, the authors develop a structural Bayesian learning model and estimate it using prescription choice and marketing communication data from a panel of physicians. From their model results, the authors find evidence of prior and dynamic perception spillovers across competing brands only when brands are sufficiently similar. In contrast, they find no evidence of spillover effects across brands that are highly dissimilar. Finally, several policy experiments illustrate the strength and significance of competitive spillovers for product diffusion, and from the results, the authors derive strategic implications for order-of-entry effects and the entry of “me-too” products.

Resource Search, Interpersonal Similarity, and Network Tie Valuation in Nascent Entrepreneurs’ Emerging Networks:

This article contributes to the entrepreneurship and network literatures by addressing the fundamental research question of how a new venture’s initial network ties are formed. The authors focus on the broad network search evinced by nascent entrepreneurs at the very earliest stages of venture and network creation and examine some of the instrumental and interpersonal mechanisms driving nascent entrepreneurs’ value attributions about the contacts met during this network search. The authors utilize a unique empirical data set of 1,407 entrepreneur–contact dyads collected during a 6-month period of real-time nascent venture activity. Their results suggest a view of new venture network construction in which the content benefits conferred through anticipated or real resource acquisition form a clear basis for entrepreneurs’ assessments of value, with the process benefits of interpersonal age and gender similarity playing an amplifying role. Contrary to their expectations, the authors did not observe direct interpersonal similarity effects. Their findings shed light on some of the very early decision processes that underlie an entrepreneur’s network search and thus are critical to network formation.

The adhesion of alumina films to metallic alloys and coatings

The adherence of protective oxide scales to alloy substrates is governed by the stored elastic energy in the scale which drives delamination and the fracture resistance of the alloy oxide interface. Clearly, any modifications to the alloy or the exposure environment which decreases the former or increases the latter will improve the durability of a given system. The stored elastic energy is determined by the stress level in the scale and the scale thickness. The stress state in the scale is determined by stresses which arise during the oxide formation (Growth Stresses), stresses produced during temperature changes as the result of thermal expansion mismatch between the oxide and the alloy (Thermal Stresses), and any stress relaxation which occurs as the result of creep of the scale or alloy. The fracture energy of the interface is a function of the composition at the interface, the microstructure in the interfacial region, and the composition of the exposure environment. This paper focuses on the results of studies of a variety of alloys and coatings, all of which form continuous alumina scales, in which it has been attempted to evaluate the effects of various alloy and exposure parameters on the stress state in the scale, the microstructure of the alloy/oxide interface, and the fracture resistance of the interface. The alloy parameters include alloy type, sulfur content, and reactive element content. The exposure parameters include oxidation temperature, temperature profile during exposure, and water vapor and sulfur contents of the atmosphere. Die Haftung von Aluminiumoxidfilmen auf metallischen Legierungen und Beschichtungen Die Haftung von Aluminiumoxidschichten auf Legierungssubstraten wird von der im Oxid gespeicherten elastischen Energie bestimmt. Diese fordert die Delamination des Oxids und die Bruchfestigkeit an der Grenzflache Legierung/Oxid. Es ist klar, dass jede Modifizierung der Legierung oder der umgebenden Gasatmosphare, welche entweder ersteres erniedrigt oder letzteres erhoht, der Bestandigkeit eines gegebenen Systems forderlich ist. Die gespeicherte elastische Energie wird durch die Hohe der Spannungen in der Schicht und durch die Schichtdicke bestimmt. Der Spannungszustand der Schicht wird durch Spannungen bestimmt, welche verursacht werden durch das Oxidwachstum (Wachstumsspannungen), durch Spannungen, welche aufgrund unterschiedlicher Warmeausdehnungskoeffizienten des Oxids und der Legierung bei Temperaturanderungen entstehen (Thermische Spannungen) und dem Spannungsabbau als Ergebnis des Kriechens von Oxid oder Legierung. Die Bruchenergie der Grenzflache ist eine Funktion der Zusammensetzung der Grenzflache, der Mikrostruktur im grenzflachennahen Bereich und der Zusammensetzung der Auslagerungsumgebung Dieser Artikel befasst sich mit Ergebnissen von Studien an einer Reihe von Legierungen und Beschichtungen, welche durchgehende Aluminiumoxidschichten bilden. Es wurde versucht, den Einfluss unterschiedlicher Legierungs- und Auslagerungsparameter auf den Spannungszustand in der Schicht, auf die Mikrostruktur der Grenzflache Oxid/Legierung und auf die Bruchfestigkeit der Grenzflache herauszufinden. Die Legierungsparameter schliesen den Legierungstyp, den Schwefelgehalt und den Gehalt an reaktiven Elementen ein. Die Auslagerungsparameter enthalten die Oxidationstemperatur, das Temperaturprofil wahrend der Auslagerung, sowie den Wasser- und Schwefelgehalt der Atmosphare.

The Impact of Geographic Proximity on What to Buy, How to Buy, and Where to Buy: Evidence from High‐Tech Durable Goods Market*

Social contagion effects due to geographical proximity refer to the social effects wherein the behavior of an individual varies with the behavior of other individuals who are geographically close. Although the influence of such effects on consumer choices has been established in several contexts, much of the extant studies have focused on its effect on consumers’ decision of whether to buy a new product or adopt a new innovation. There has been no systematic examination of the influence of geographic proximity on other aspects of consumers’ product buying process such as what to buy (i.e., brand choice), how to buy (i.e., the channel), and where to buy (i.e., retailers). Such effects can matter significantly in high-technology and durable goods markets and therefore, it is critical to understand the scope of these on consumers’ choice of retailers and channel as well. Drawing on literatures from word of mouth effects, ecommerce, and consumers’ perception of risk in their purchase process, we develop a set of hypotheses on the effect of geographic proximity on consumers’ choices of what to buy, how to buy, and where to buy. Leveraging a microlevel dataset of purchases of personal computers, we develop brand-, retailer-, and channel-related measures of proximity effects at the individual consumer level and estimate a joint disaggregate model of the three choices that make up a product purchase process to test these hypotheses. Our results indicate a significant contagion effect on each of the three choices. Furthermore, we find evidence of a greater effect of geographic proximity on inexperienced consumers—those who are new to the product category. Our results thus help develop a holistic understanding of the influence of social contagion effects on consumers’ decision making.

Social Dollars in Online Communities: The Effect of Product, User, and Network Characteristics

Online communities have experienced burgeoning popularity over the last decade and have become a key platform for users to share information and interests, and to engage in social interactions. Drawing on the social contagion literature, the authors examine the effect of online social connections on users’ product purchases in an online community. They assess how product, user, and network characteristics influence the social contagion effect in users’ spending behavior. The authors use a unique large-scale data set from a popular massively multiplayer online role-playing game community—consisting of users’ detailed gaming activities, their social connections, and their in-game purchases of functional and hedonic products—to examine the impact of gamers’ social networks on their purchase behavior. The analysis, based on a double-hurdle model that captures gamers’ decisions of playing and spending levels, reveals evidence of “social dollars,” whereby social interaction between gamers in the community increases their in-game product purchases. Interestingly, the results indicate that social influence varies across different types of products. Specifically, the effect of a focal users network ties on his or her spending on hedonic products is greater than the effect of network ties on the focal users spending on functional products. Furthermore, the authors find that user experience negatively moderates social contagion for functional products, whereas it positively moderates contagion for hedonic products. In addition, dense networks enhance contagion over functional product purchases, whereas they mitigate the social influence effect over hedonic product purchases. The authors perform a series of tests and robustness checks to rule out the effect of confounding factors. They supplement their econometric analyses with dynamic matching techniques and estimate average treatment effects. The results of the study have implications for both theory and practice and help provide insights on how managers can monetize social networks and use social information to increase user engagement in online communities.