We explore the linkages between social media marketing activeness and reputational assets on digital platforms with a unique sample of over 8,000 C2C sellers on both Taobao, China’s largest C2C online shopping platform, and Sina Weibo, China’s largest microblogging platform. A unique collaborative effort between the two platforms enables us to examine whether C2C sellers are motivated to engage in marketing activities on a separate platform. Applying machine learning and NLP methods, we first identify whether C2C sellers conduct social media marketing on their microblogs. We then differentiate between earned and owned reputation factors accumulated on both platforms and test their relationships to social media marketing activeness. We find that earned reputation factors on both platforms are significantly associated with social media marketing activeness. However, we identify a conflict of owned reputation factors between the two platforms, which provides a potential explanation for the limited success of the cross-platform collaboration.
{"title":"Reputational Assets and Social Media Marketing Activeness: Empirical Insights from China","authors":"Anders C. Johansson, Zhen Zhu","doi":"10.2139/ssrn.3908415","DOIUrl":"https://doi.org/10.2139/ssrn.3908415","url":null,"abstract":"We explore the linkages between social media marketing activeness and reputational assets on digital platforms with a unique sample of over 8,000 C2C sellers on both Taobao, China’s largest C2C online shopping platform, and Sina Weibo, China’s largest microblogging platform. A unique collaborative effort between the two platforms enables us to examine whether C2C sellers are motivated to engage in marketing activities on a separate platform. Applying machine learning and NLP methods, we first identify whether C2C sellers conduct social media marketing on their microblogs. We then differentiate between earned and owned reputation factors accumulated on both platforms and test their relationships to social media marketing activeness. We find that earned reputation factors on both platforms are significantly associated with social media marketing activeness. However, we identify a conflict of owned reputation factors between the two platforms, which provides a potential explanation for the limited success of the cross-platform collaboration.","PeriodicalId":319647,"journal":{"name":"DecisionSciRN: Decision-Making in Marketing (Topic)","volume":"47 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2023-08-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"114514114","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Many online marketplaces offer sponsored product listings as third-party sellers’ ad slots that are blended in organic product listings. A seller’s potential benefit from sponsored listings is a non- trivial question, as a consumer may prefer or avoid advertised products and such preferences can be position-specific. This paper investigates a seller’s advertising incentives across positions in a large-scale field experiment. We provide the first evidence that consumers may avoid sponsored listings and prefer organic listings of same products in prime positions, whereas the negative ad effects can be attenuated in lower positions. To evaluate a seller’s financial benefits, we conduct a model-based ROI analysis with potential ad-induced position shifts. A seller is predicted to make positive net profits with ad-induced position elevation, depending on target ad placements and ratios between unit profit margin and ad cost per click. The results suggest that the value of sponsored listings for a seller mainly comes from position relocation, not from visual prominence at a given position.
{"title":"Seller Incentives in Sponsored Product Listings on Online Marketplaces","authors":"Mingyu Joo, Jiaqi Shi, Vibhanshu Abhishek","doi":"10.2139/ssrn.3896716","DOIUrl":"https://doi.org/10.2139/ssrn.3896716","url":null,"abstract":"Many online marketplaces offer sponsored product listings as third-party sellers’ ad slots that are blended in organic product listings. A seller’s potential benefit from sponsored listings is a non- trivial question, as a consumer may prefer or avoid advertised products and such preferences can be position-specific. This paper investigates a seller’s advertising incentives across positions in a large-scale field experiment. We provide the first evidence that consumers may avoid sponsored listings and prefer organic listings of same products in prime positions, whereas the negative ad effects can be attenuated in lower positions. To evaluate a seller’s financial benefits, we conduct a model-based ROI analysis with potential ad-induced position shifts. A seller is predicted to make positive net profits with ad-induced position elevation, depending on target ad placements and ratios between unit profit margin and ad cost per click. The results suggest that the value of sponsored listings for a seller mainly comes from position relocation, not from visual prominence at a given position.","PeriodicalId":319647,"journal":{"name":"DecisionSciRN: Decision-Making in Marketing (Topic)","volume":"4 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-08-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130126059","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
It is important for marketing academics and public policymakers to understand how to persuade consumers to consume healthier food instead of unhealthy food. Based on the theories of synchrony effect and self-control, this research makes novel predictions about the time-of-day effects on (un)healthy food purchases. The results of a field study and a laboratory experiment confirm that consumers’ self-control level becomes lower in the evening, which leads consumers to buy more unhealthy products in the evening than they do in the morning. A follow-up eye-tracking experiment reveals the underlying mechanism through which self-control failure makes consumers pay more visual attention to unhealthy food and the weaker effect of attention to healthy food on purchases. The results of this study provide valuable insights not only for marketing academics but also for retailers and consumer marketing companies.
{"title":"Time-of-Day Effects on (Un)Healthy Product Purchases: Insights from Diverse Consumer Behavior Data","authors":"Shuai Yang, Yizhe Wang, Zhen Li, Chiyin Chen, Ziyue Yu","doi":"10.2139/ssrn.3837110","DOIUrl":"https://doi.org/10.2139/ssrn.3837110","url":null,"abstract":"It is important for marketing academics and public policymakers to understand how to persuade consumers to consume healthier food instead of unhealthy food. Based on the theories of synchrony effect and self-control, this research makes novel predictions about the time-of-day effects on (un)healthy food purchases. The results of a field study and a laboratory experiment confirm that consumers’ self-control level becomes lower in the evening, which leads consumers to buy more unhealthy products in the evening than they do in the morning. A follow-up eye-tracking experiment reveals the underlying mechanism through which self-control failure makes consumers pay more visual attention to unhealthy food and the weaker effect of attention to healthy food on purchases. The results of this study provide valuable insights not only for marketing academics but also for retailers and consumer marketing companies.","PeriodicalId":319647,"journal":{"name":"DecisionSciRN: Decision-Making in Marketing (Topic)","volume":"135 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2021-03-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"124001846","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Consumers experience a sense of loss when a product’s quality does not match their expectations. To alleviate consumer loss aversion (CLA), firms can disclose information to reduce consumers’ uncertainty about product quality and the resulting psychological loss. In this paper, we investigate the implications of CLA on firm profit, consumer surplus, and social welfare when firms endogenously make quality disclosure decisions. We find that CLA leads symmetric firms to disclose quality more often. Given that CLA weakly reduces consumers’ utility from buying a product and quality disclosure is costly, intuition suggests that CLA is detrimental to firms. We find that this intuition is true only in a monopoly. Surprisingly, CLA makes both firms in a competition better off. Moreover, CLA increases firms’ profit when they invest in quality disclosure instead of money-back guarantees to respond to CLA. We also find that CLA decreases consumer surplus and social welfare. Therefore, educating consumers to improve decision-making skills by deliberating on future outcomes and emotions can benefit firms at the cost of consumers and society. When firms disclose quality sequentially, CLA can discourage the follower from disclosing quality. A strong level of CLA increases the leader’s profit over the follower’s, thereby encouraging firms to be the first mover in quality disclosure. This paper was accepted by Juanjuan Zhang, marketing.
{"title":"Quality Disclosure Under Consumer Loss Aversion","authors":"Jianqiang Zhang, Krista J. Li","doi":"10.2139/ssrn.3544738","DOIUrl":"https://doi.org/10.2139/ssrn.3544738","url":null,"abstract":"Consumers experience a sense of loss when a product’s quality does not match their expectations. To alleviate consumer loss aversion (CLA), firms can disclose information to reduce consumers’ uncertainty about product quality and the resulting psychological loss. In this paper, we investigate the implications of CLA on firm profit, consumer surplus, and social welfare when firms endogenously make quality disclosure decisions. We find that CLA leads symmetric firms to disclose quality more often. Given that CLA weakly reduces consumers’ utility from buying a product and quality disclosure is costly, intuition suggests that CLA is detrimental to firms. We find that this intuition is true only in a monopoly. Surprisingly, CLA makes both firms in a competition better off. Moreover, CLA increases firms’ profit when they invest in quality disclosure instead of money-back guarantees to respond to CLA. We also find that CLA decreases consumer surplus and social welfare. Therefore, educating consumers to improve decision-making skills by deliberating on future outcomes and emotions can benefit firms at the cost of consumers and society. When firms disclose quality sequentially, CLA can discourage the follower from disclosing quality. A strong level of CLA increases the leader’s profit over the follower’s, thereby encouraging firms to be the first mover in quality disclosure. This paper was accepted by Juanjuan Zhang, marketing.","PeriodicalId":319647,"journal":{"name":"DecisionSciRN: Decision-Making in Marketing (Topic)","volume":"167 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-02-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"133532227","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
“Freemium,” whereby a basic service level is provided free of charge but consumers are charged for more advanced features, has become a popular business model for firms selling digital goods. However, it is not clear whether the launch of a free version helps or hurts the demand of an existing paid version. The free version may allow consumers to sample the product before making a purchase decision and subsequently increase demand of the paid version, but it may also cannibalize demand of the paid version. We use a comprehensive data set on game apps from Apple’s App Store that tracks the launch of both the paid and the free versions of individual apps on a daily level to identify whether a freemium strategy stimulates or hurts demand of an existing paid version. We estimate the spillover effects between the free version and the paid version of the same app under a difference-in-difference framework, relying on the fact that app developers cannot predict the exact launch date of the free version of the app due to Apple’s review and approval of apps prior to release and accounting for app-level product heterogeneity. We find that the launch of a free version increases demand of the paid version of the same app. Under the main specification, if the daily number of ratings before the free version’s launch is at the mean, then all else equal, the launch of the free version leads to an 8.9% increase in the daily number of ratings. We then describe multiple robustness checks. Finally, we present evidence that the results are driven by consumers sampling the free version as well as enhanced app discovery and explore the relative importance of the two mechanisms. This paper was accepted by Matthew Shum, marketing. Supplemental Material: The data files and online appendices are available at https://doi.org/10.1287/mnsc.2022.4619 .
{"title":"Spillover Effects and Freemium Strategy in the Mobile App Market","authors":"Yiting Deng, Anja Lambrecht, Yongdong Liu","doi":"10.2139/ssrn.3149550","DOIUrl":"https://doi.org/10.2139/ssrn.3149550","url":null,"abstract":"“Freemium,” whereby a basic service level is provided free of charge but consumers are charged for more advanced features, has become a popular business model for firms selling digital goods. However, it is not clear whether the launch of a free version helps or hurts the demand of an existing paid version. The free version may allow consumers to sample the product before making a purchase decision and subsequently increase demand of the paid version, but it may also cannibalize demand of the paid version. We use a comprehensive data set on game apps from Apple’s App Store that tracks the launch of both the paid and the free versions of individual apps on a daily level to identify whether a freemium strategy stimulates or hurts demand of an existing paid version. We estimate the spillover effects between the free version and the paid version of the same app under a difference-in-difference framework, relying on the fact that app developers cannot predict the exact launch date of the free version of the app due to Apple’s review and approval of apps prior to release and accounting for app-level product heterogeneity. We find that the launch of a free version increases demand of the paid version of the same app. Under the main specification, if the daily number of ratings before the free version’s launch is at the mean, then all else equal, the launch of the free version leads to an 8.9% increase in the daily number of ratings. We then describe multiple robustness checks. Finally, we present evidence that the results are driven by consumers sampling the free version as well as enhanced app discovery and explore the relative importance of the two mechanisms. This paper was accepted by Matthew Shum, marketing. Supplemental Material: The data files and online appendices are available at https://doi.org/10.1287/mnsc.2022.4619 .","PeriodicalId":319647,"journal":{"name":"DecisionSciRN: Decision-Making in Marketing (Topic)","volume":"67 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-02-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"124541964","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We build a model of information search within a web-page using eye-tracking data collected during two incentive-compatible, online shopping experiments. We assume that shoppers make eye fixation decisions based on the attractiveness of the visual elements on the page and the effort of moving their eyes towards those elements. These elements contain product information and clickable links to new pages. After each fixation, shoppers choose either to continue search or to end search by clicking on a link within a fixated element when its attractiveness crosses a decision threshold. Our model contains dynamics that allow for Bayesian updating of product information, decision threshold trends, and one-stage ahead decision inputs. Using posterior predictive checks, we demonstrate that our model makes accurate in-sample predictions regarding the sequence of fixations and clicks. In Experiment 1, we use counterfactual simulations to predict the effects of hypothetical product layouts. In Experiment 2, we empirically test these counterfactual predictions. We also conduct sensitivity analyses to assess how near to optimally shoppers searched. These results provide guidance for the design of online product displays.
{"title":"Information Search within a Webpage: Boundedly Rational Models of Eye Movements and Clicks","authors":"Joy Lu, J. W. Hutchinson","doi":"10.2139/ssrn.3611320","DOIUrl":"https://doi.org/10.2139/ssrn.3611320","url":null,"abstract":"We build a model of information search within a web-page using eye-tracking data collected during two incentive-compatible, online shopping experiments. We assume that shoppers make eye fixation decisions based on the attractiveness of the visual elements on the page and the effort of moving their eyes towards those elements. These elements contain product information and clickable links to new pages. After each fixation, shoppers choose either to continue search or to end search by clicking on a link within a fixated element when its attractiveness crosses a decision threshold. Our model contains dynamics that allow for Bayesian updating of product information, decision threshold trends, and one-stage ahead decision inputs. Using posterior predictive checks, we demonstrate that our model makes accurate in-sample predictions regarding the sequence of fixations and clicks. In Experiment 1, we use counterfactual simulations to predict the effects of hypothetical product layouts. In Experiment 2, we empirically test these counterfactual predictions. We also conduct sensitivity analyses to assess how near to optimally shoppers searched. These results provide guidance for the design of online product displays.","PeriodicalId":319647,"journal":{"name":"DecisionSciRN: Decision-Making in Marketing (Topic)","volume":"10 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2019-09-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"125945775","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The paper is based on information which is a combination of store advertisement and consumers’ path inside the store along with product information. With this information, the authors find how advertisement affects the behavior of consumers when making the decision. The findings suggest that advertisement has a small impact on customers inside the stores. Null effect is determined, and one standard deviation in advertising has an impact on store traffic by 1.2%. But the impact at a lower end of the model is observed. One standard deviation in advertisement has impacted the store sales by 8.4%. Based on further data mining, the research has found that there is no significant improvement in the number of customers, but the increase in sales is because of the higher quantity of purchases by the existing consumers. However, the effect of advertisement on products placed in the same or nearby shelf is not found, the impact on product varieties in the same segment is also not found. Based on these research findings, the authors find the right approach towards advertisement.
{"title":"Influence of Advertisement on Customers Based on AIDA Model","authors":"Mithun S. Ullal, Iqbal Thonse Hawaldar","doi":"10.2139/ssrn.3513259","DOIUrl":"https://doi.org/10.2139/ssrn.3513259","url":null,"abstract":"The paper is based on information which is a combination of store advertisement and consumers’ path inside the store along with product information. With this information, the authors find how advertisement affects the behavior of consumers when making the decision. The findings suggest that advertisement has a small impact on customers inside the stores. Null effect is determined, and one standard deviation in advertising has an impact on store traffic by 1.2%. But the impact at a lower end of the model is observed. One standard deviation in advertisement has impacted the store sales by 8.4%. Based on further data mining, the research has found that there is no significant improvement in the number of customers, but the increase in sales is because of the higher quantity of purchases by the existing consumers. However, the effect of advertisement on products placed in the same or nearby shelf is not found, the impact on product varieties in the same segment is also not found. Based on these research findings, the authors find the right approach towards advertisement.","PeriodicalId":319647,"journal":{"name":"DecisionSciRN: Decision-Making in Marketing (Topic)","volume":"43 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2018-12-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"123866380","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Nowadays, private labeling has become a widely implemented strategy by modern market retailers. Retailers such as supermarkets and hypermarkets have superior supply chain in the country that they begin to extend their brand and make their own products, which is called private brand. The growth of private brands in Indonesia has been fairly stagnant as brand names step up both promotional activity and innovation efforts to protect share positions and drive growth. Based on Nielsen survey, the private label share in Indonesia only reaches one percentage. Why has the growth of private labelling in Indonesia been so slow? In short, Asian shoppers are strongly brand-loyal and retailers have not invested enough in marketing private label to persuade shoppers to trust its quality. Meanwhile, Superindo as one of the biggest retails in Indonesia has 8% growth of private brand share. Numerous studies have identified several factors affecting the purchase decision of private brand, and yet little empirical research has investigated the factors underlying consumer’s purchase decision of private brand in Indonesia especially of Superindo. In order to expand market share, private brands need to clearly identify what triggers consumer purchases. This paper aims to investigate the relationship between consumer’s decision-making styles and actual purchases of private label products in Indonesia market. This paper extends the work of Glynn and Chen (2009), Lian Fong et al (2015), and Thanasuta (2015) by examining Price consciousness, Price-quality association, Brand loyalty, Quality variability, Search vs. experience, Price perceived, Promotion, Brand Image, Quality Consciousness, Brand Consciousness, Value Consciousness, and Risk perception factors for investigation. In this research, both secondary data and primary were utilized. The primary data in the form of quantitative data were collected through online survey to 400 respondents and factor analysis was employed to identify the associations. The secondary data were obtained from relevant literatures, online journals, articles, blogs, and other electronic sources. The results indicate that Brand Consciousness and Search vs. experience influence consumer’s proneness to buy Private Brand.
{"title":"Indonesia Consumer’s Purchase Decisions and Private Label Brands: Study of Superindo Retailer","authors":"T. Saraswati, M. E. Saputri","doi":"10.2139/ssrn.3353160","DOIUrl":"https://doi.org/10.2139/ssrn.3353160","url":null,"abstract":"Nowadays, private labeling has become a widely implemented strategy by modern market retailers. Retailers such as supermarkets and hypermarkets have superior supply chain in the country that they begin to extend their brand and make their own products, which is called private brand. The growth of private brands in Indonesia has been fairly stagnant as brand names step up both promotional activity and innovation efforts to protect share positions and drive growth. Based on Nielsen survey, the private label share in Indonesia only reaches one percentage. Why has the growth of private labelling in Indonesia been so slow? In short, Asian shoppers are strongly brand-loyal and retailers have not invested enough in marketing private label to persuade shoppers to trust its quality. Meanwhile, Superindo as one of the biggest retails in Indonesia has 8% growth of private brand share. Numerous studies have identified several factors affecting the purchase decision of private brand, and yet little empirical research has investigated the factors underlying consumer’s purchase decision of private brand in Indonesia especially of Superindo. In order to expand market share, private brands need to clearly identify what triggers consumer purchases. This paper aims to investigate the relationship between consumer’s decision-making styles and actual purchases of private label products in Indonesia market. This paper extends the work of Glynn and Chen (2009), Lian Fong et al (2015), and Thanasuta (2015) by examining Price consciousness, Price-quality association, Brand loyalty, Quality variability, Search vs. experience, Price perceived, Promotion, Brand Image, Quality Consciousness, Brand Consciousness, Value Consciousness, and Risk perception factors for investigation. In this research, both secondary data and primary were utilized. The primary data in the form of quantitative data were collected through online survey to 400 respondents and factor analysis was employed to identify the associations. The secondary data were obtained from relevant literatures, online journals, articles, blogs, and other electronic sources. The results indicate that Brand Consciousness and Search vs. experience influence consumer’s proneness to buy Private Brand.","PeriodicalId":319647,"journal":{"name":"DecisionSciRN: Decision-Making in Marketing (Topic)","volume":"10 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2017-03-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"116857225","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Firms using online advertising regularly run experiments with multiple versions of their ads since they are uncertain about which ones are most effective. Within a campaign, firms try to adapt to intermediate results of their tests, optimizing what they earn while learning about their ads. But how should they decide what percentage of impressions to allocate to each ad? This paper answers that question, resolving the well-known "learn-and-earn'' trade-off using multi-armed bandit (MAB) methods. The online advertiser's MAB problem, however, contains particular challenges, such as a hierarchical structure (ads within a website), attributes of actions (creative elements of an ad), and batched decisions (millions of impressions at a time), that are not fully accommodated by existing MAB methods. Our approach captures how the impact of observable ad attributes on ad effectiveness differs by website in unobserved ways, and our policy generates allocations of impressions that can be used in practice. We implemented this policy in a live field experiment delivering over 700 million ad impressions in an online display campaign with a large retail bank. Over the course of two months, our policy achieved an 8% improvement in the customer acquisition rate, relative to a control policy, without any additional costs to the bank. Beyond the actual experiment, we performed counterfactual simulations to evaluate a range of alternative model specifications and allocation rules in MAB policies. Finally, we show that customer acquisition would decrease about 10% if the firm were to optimize click through rates instead of conversion directly, a finding that has implications for understanding the marketing funnel.
{"title":"Customer Acquisition via Display Advertising Using Multi-Armed Bandit Experiments","authors":"Eric M. Schwartz, Eric T. Bradlow, P. Fader","doi":"10.2139/ssrn.2368523","DOIUrl":"https://doi.org/10.2139/ssrn.2368523","url":null,"abstract":"Firms using online advertising regularly run experiments with multiple versions of their ads since they are uncertain about which ones are most effective. Within a campaign, firms try to adapt to intermediate results of their tests, optimizing what they earn while learning about their ads. But how should they decide what percentage of impressions to allocate to each ad? This paper answers that question, resolving the well-known \"learn-and-earn'' trade-off using multi-armed bandit (MAB) methods. The online advertiser's MAB problem, however, contains particular challenges, such as a hierarchical structure (ads within a website), attributes of actions (creative elements of an ad), and batched decisions (millions of impressions at a time), that are not fully accommodated by existing MAB methods. Our approach captures how the impact of observable ad attributes on ad effectiveness differs by website in unobserved ways, and our policy generates allocations of impressions that can be used in practice. We implemented this policy in a live field experiment delivering over 700 million ad impressions in an online display campaign with a large retail bank. Over the course of two months, our policy achieved an 8% improvement in the customer acquisition rate, relative to a control policy, without any additional costs to the bank. Beyond the actual experiment, we performed counterfactual simulations to evaluate a range of alternative model specifications and allocation rules in MAB policies. Finally, we show that customer acquisition would decrease about 10% if the firm were to optimize click through rates instead of conversion directly, a finding that has implications for understanding the marketing funnel.","PeriodicalId":319647,"journal":{"name":"DecisionSciRN: Decision-Making in Marketing (Topic)","volume":"50 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2016-03-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127264694","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This case set draws on a summer internship in brand management to outline potential steps in bringing a new food product to life. While there are general guidelines to the new product (brand, grocery aisle, and target market), the rest of the product development is up to the team of marketers and research and developers. The assignment is split into three parts to give students the opportunity to suggest next steps, and then learn what the team actually did in terms of market research and overall timeline. Part A sets up the task at hand for the proceeding parts and includes the background information. This part defines the new product as a snack geared toward Generation Z, specifically teenagers, that must be branded by a cereal brand. Provided with general insights about the target population in the exhibits, the student must determine what they should do first to understand Gen Z's snacking habits and make strides toward product development.Part B begins by explaining the actual next steps that were taken—in-home focus groups with teens and their parents—as well as why this was the chosen tactic. After explaining the market research tactics, the case skips to the insights the team developed, including a job map and four functional attributes. This part ends with the question of what to do as a next step since insights have been developed, but nothing physical has yet to be created. Part C starts with additional qualitative testing to refine concepts and begin the prototyping phase. This part wraps up the entirety of the case with choosing finalists through focus group interviews. As the summer internship comes to an end, the case does as well with an outline of future steps for the team to complete prior to launching the new product (such as surveys, mock shelf simulations, test markets, and the possibility of additional research to define packaging). This case set is a great example of one of the many projects that MBA students might face during their summer internships or full-time jobs, as well as an overall learning in decision-making without perfect information to keep an idea afloat. This case is ideal for in introduction to marketing research. Excerpt UVA-M-0999 Jun. 3, 2020 Snack Time with Generation Z (A) Meade Brewster stared at her empty screen, contemplating the conversation she just had with her manager. “Where do I even start?” she asked herself. It was day three of Brewster's 2019 summer internship as an assistant brand manager in the snacking division for General Mills (GM), after her first year at the Darden School of Business (MBA '20). Days one and two were easy—HR and marketing training all day long. She now knew how to input her time and search for brands and key performance indicators (KPIs) in Nielsen. But after just being briefed on her summer-long project, she felt lost all over again. Brewster's manager, Henry, explained the project like this: “The snacking business unit is down and a major focus as we enter FY2020 (s
本案例集借鉴了品牌管理的暑期实习，概述了将新的食品产品带入生活的潜在步骤。虽然新产品有一般的指导方针(品牌、杂货店通道和目标市场)，但产品开发的其余部分取决于营销人员、研究人员和开发人员的团队。作业分为三个部分，让学生有机会提出下一步的建议，然后了解团队在市场研究和总体时间表方面实际做了什么。A部分为后续部分设置了手头的任务，并包括背景信息。这部分将新产品定义为面向Z世代，特别是青少年的零食，必须由谷物品牌打上品牌。在了解了展品中目标人群的大致情况后，学生必须决定他们首先应该做什么来了解Z世代的零食习惯，并在产品开发方面取得进展。B部分首先解释了接下来要采取的实际步骤——在家里与青少年和他们的父母进行焦点小组讨论——以及为什么选择这种策略。在解释了市场研究策略之后，案例跳转到团队开发的见解，包括工作图和四个功能属性。这一部分的最后一个问题是，既然已经有了洞察力，但还没有创造出任何实际的东西，下一步该做什么。C部分从额外的定性测试开始，以细化概念并开始原型阶段。这一部分通过焦点小组访谈选择最终入围者来结束整个案例。随着暑期实习的结束，该案例也概述了团队在推出新产品之前要完成的未来步骤(如调查，模拟货架模拟，测试市场，以及定义包装的额外研究的可能性)。这个案例集是MBA学生在暑期实习或全职工作期间可能面临的众多项目之一，也是在没有完美信息的情况下全面学习决策的一个很好的例子。本案例是市场研究入门的理想案例。米德·布鲁斯特(Meade Brewster)盯着空空的屏幕，思考着她刚刚与经理的谈话。“我从哪里开始呢?”她问自己。这是布鲁斯特2019年暑期实习的第三天，她在通用磨坊(General Mills)的零食部门担任助理品牌经理，此前她在达顿商学院(Darden School of Business, MBA '20)读了一年级。第一天和第二天很容易——一整天都是人力资源和营销培训。她现在知道如何在尼尔森输入时间，搜索品牌和关键绩效指标(kpi)。但在听取了她的暑期项目简报后，她又一次感到迷茫。布鲁斯特的经理亨利(Henry)这样解释这个项目:“随着我们进入2020财年，零食业务部门正在下降，这是一个主要焦点(见表1)，特别是因为行业的所有趋势都表明消费者对零食的偏好在增加。正如你所想象的那样，由于进入门槛较低，最近市场出现了许多颠覆性品牌。我们需要你做的是创造一条新的增长型产品线，在零食市场竞争。”亨利停顿了一下，看着布鲁斯特，她一定看起来像一头在车灯下的鹿，因为她已经想到了许多选择
{"title":"Snack Time with Generation Z(A)","authors":"Luca Cian, Meade Brewster","doi":"10.2139/ssrn.3626120","DOIUrl":"https://doi.org/10.2139/ssrn.3626120","url":null,"abstract":"This case set draws on a summer internship in brand management to outline potential steps in bringing a new food product to life. While there are general guidelines to the new product (brand, grocery aisle, and target market), the rest of the product development is up to the team of marketers and research and developers. The assignment is split into three parts to give students the opportunity to suggest next steps, and then learn what the team actually did in terms of market research and overall timeline. Part A sets up the task at hand for the proceeding parts and includes the background information. This part defines the new product as a snack geared toward Generation Z, specifically teenagers, that must be branded by a cereal brand. Provided with general insights about the target population in the exhibits, the student must determine what they should do first to understand Gen Z's snacking habits and make strides toward product development.Part B begins by explaining the actual next steps that were taken—in-home focus groups with teens and their parents—as well as why this was the chosen tactic. After explaining the market research tactics, the case skips to the insights the team developed, including a job map and four functional attributes. This part ends with the question of what to do as a next step since insights have been developed, but nothing physical has yet to be created. Part C starts with additional qualitative testing to refine concepts and begin the prototyping phase. This part wraps up the entirety of the case with choosing finalists through focus group interviews. As the summer internship comes to an end, the case does as well with an outline of future steps for the team to complete prior to launching the new product (such as surveys, mock shelf simulations, test markets, and the possibility of additional research to define packaging). This case set is a great example of one of the many projects that MBA students might face during their summer internships or full-time jobs, as well as an overall learning in decision-making without perfect information to keep an idea afloat. This case is ideal for in introduction to marketing research. Excerpt UVA-M-0999 Jun. 3, 2020 Snack Time with Generation Z (A) Meade Brewster stared at her empty screen, contemplating the conversation she just had with her manager. “Where do I even start?” she asked herself. It was day three of Brewster's 2019 summer internship as an assistant brand manager in the snacking division for General Mills (GM), after her first year at the Darden School of Business (MBA '20). Days one and two were easy—HR and marketing training all day long. She now knew how to input her time and search for brands and key performance indicators (KPIs) in Nielsen. But after just being briefed on her summer-long project, she felt lost all over again. Brewster's manager, Henry, explained the project like this: “The snacking business unit is down and a major focus as we enter FY2020 (s","PeriodicalId":319647,"journal":{"name":"DecisionSciRN: Decision-Making in Marketing (Topic)","volume":"1 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"1900-01-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130698869","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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