Multidimensional Observational Learning in Social Networks: Theory and Experimental Evidence

Abstract

The unprecedented growth of social network users in the last decade has resulted in significant increases in the availability of individual-specific information such as holiday pictures, mobile check-ins at restaurants, and information on everyday purchases. Consumers shopping through social network channels are increasingly using this information in making their purchase decisions. We find that social ties impact the magnitude of observational learning. In the case of strangers, the effect of learning is stronger for vertically differentiated products than for horizontally differentiated products; whereas in the case of friends, the effect of learning for vertically differentiated products is similar to that for horizontally differentiated products. Moreover, the type of product impacts the magnitude of observational learning. For horizontally differentiated products, the effect of learning from friends is stronger than that from strangers; whereas for vertically differentiated products, the effect of learning from friends is similar to that from strangers. These findings provide motivation for online retailers to generate alternative strategies for increasing product sales through social networks. For example, online retailers offering horizontally differentiated products have strong incentives to cooperate with social media platforms (e.g., Instagram and Pinterest) in encouraging customers to share their purchase information.

Social Networks and their Impact on the e-Commerce e-Commerce of SMEs in the Footwear Sector: A Systematic Systematic Review between the Years 2011-2021

“…En segundo lugar, el E-commerce y el Marketing Online (EMO) cuenta con 3 elementos principales, estos son las creencias de gestión, actividades de iniciación y actividades de implementación, el grado de EMO es influenciado por la ventaja relativa que el consumidor percibe y por la presión que este mismo ejerce mediante su poder adquirido gracias a las redes sociales [17]. Asimismo, en los bienes que se diferencian por su calidad, es más efectivo cuando algún extraño le hace conocer al consumidor sobre el producto, mientras que en los bienes que se diferencian por la conveniencia de su obtención, es más efectivo que alguna persona cercana, como un familiar o amigo, le haga saber al consumidor sobre el producto [18].…”

“…El aprender de extraños es más efectivo para los productos diferenciados verticalmente que para los productos diferenciados horizontalmente, los minoristas en línea que ofrecen productos diferenciados horizontalmente tienen fuertes incentivos para cooperar con las plataformas de redes sociales y para alentar a los clientes a compartir su información de compra [18].…”

Demand information acquisition strategy in a dual channel supply chain

“…Our study is also related to studies on information acquisition. Information advantage on demand, product quality, and cost reduction can benefit a member of a supply chain (Gardete & Guo, 2021; Sun et al, 2019), so firms may attempt to acquire it (Cao et al, 2020; Guan & Chen, 2017; Qiu et al, 2021). A firm can obtain demand information by conducting market research (Shang et al, 2015; Shi, 2015), developing data acquisition technology (e.g., consumer scanning technology) (Guo, 2009; Shi et al, 2021), or by going through third‐party data service providers (Guan & Chen, 2017; Hao et al, 2018; Jiang et al, 2016).…”

Exploring bimodal multi‐level networks: Network structure and dynamics driving herding effects and growth in livestreaming

“…Research indicates the coexistence of the herding effect and other factors rather than focusing solely on the herding effect. The herding phenomenon is present in social media word‐of‐mouth (Jin et al, 2020; Li & Wu, 2018; Tian et al, 2021) and social network activities (Lee et al, 2015; Liu et al, 2015; Mattke et al, 2020; Qiu et al, 2018, 2021; Sunder et al, 2019; Xu & Liu, 2019). For instance, Chen et al (2011) identified the interaction effect of observational learning and word‐of‐mouth in e‐commerce.…”