a b s t r a c tSocial broadcasting networks such as Twitter in the U.S. and "Weibo" in China are transforming the way online word of mouth (WOM) is disseminated and consumed in the digital age. In the present study, we investigated whether and how Twitter WOM affects movie sales by estimating a dynamic panel data model using publicly available data and well-known machine learning algorithms. We found that chatter on Twitter does matter; however, the magnitude and direction of the effect depend on whom the WOM is from and what the WOM is about. Incorporating the number of followers the author of each WOM message had into our study, we found that the effect of WOM from users followed by more Twitter users is significantly larger than those followed by less Twitter users. In support of some recent findings about the importance of WOM valence on product sales, we also found that positive Twitter WOM is associated with higher movie sales, whereas negative WOM is associated with lower movie sales. Interestingly, we found that the strongest effect on movie sales comes from those tweets in which the authors expressed their intention to watch a certain movie. We attribute this finding to the dual effects of such intention tweets on movie sales: the direct effect through the WOM author's own purchase behavior, and the indirect effect through either the awareness effect or the persuasive effect of the WOM on its recipients. Our findings provide new perspectives to understand the effect of WOM on product sales and have important managerial implications. For example, our study reveals the potential values of monitoring people's intentions and sentiments on Twitter and identifying influential users for companies wishing to harness the power of social broadcasting networks.
The rise of social broadcasting technologies has greatly facilitated open access to information worldwide, not only by powering decentralized information production and consumption, but also by expediting information diffusion through social interactions like content sharing. Voluntary information sharing by users in the context of Twitter, the predominant social broadcasting site, is studied by modeling both the technology and user behavior. A detailed data set about the official content-sharing function on Twitter, called retweet, is collected and the statistical relationships between users' social network characteristics and their retweeting acts are documented. A two-stage consumption-sharing model is then estimated using the conditional maximum likelihood estimatio (MLE) method. The empirical results convincingly support our hypothesis that weak ties (in the form of unidirectional links) are more likely to engage in the social exchange process of content sharing. Specifically, we find that after a median quality tweet (as defined in the sample) is consumed, the likelihood that a unidirectional follower will retweet is 3.1 percentage point higher than the likelihood that a bidirectional follower will do so.The post quickly attracted attention and was forwarded by Mr.Urbahn's subscribers on Twitter, and within two minutes, there were already more than 300 reactions to it. In the following hour, tens of thousands more users in the Twitter world were passing this message, and the final number of people who were exposed to the information before the formal White House announcement was even higher.This example not only shows the sheer power of Twitter as a fast-growing social medium, but also demonstrates that the 1 Ravi Bapna was the accepting senior editor for this paper. Ramesh Sankaranarayanan served as the associate editor.The appendices for this paper are located in the "Online Supplements" section of the MIS Quarterly's website (http://www.misq.org). 2 @keithurbahn, http://twitter.com/keithurbahn.
W e study the deferred payment and inspection mechanisms for mitigating supplier product adulteration, with endogenous procurement decision and general defect discovery process. We first derive the optimal deferred payment contract, which reveals that either entire or partial deferral can arise, depending on the moral hazard severity and the information accumulation rate. Because of the supplier's incentive to adulterate, the optimal procurement quantity under deferred payment generally is smaller than the first-best quantity. We then investigate the inspection mechanism and characterize the equilibrium. We find that under the inspection mechanism, the optimal procurement quantity is no less than the first best. A comparison between these two mechanisms shows that the deferred payment mechanism generally can outperform the inspection mechanism when either the market size is small or the profit margin is low. However, we find that these two mechanisms can also be complementary, for which we characterize a necessary condition.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.