Wednesday, May 29, 2013

Popular social media site Twitter may eventually resemble a broadcast medium like television or radio, with users reading messages written by celebrities and corporations rather than writing their own “tweet” messages of up to 140 characters, suggests a new study coauthored by Andrew T. Stephen, assistant professor of business administration and Katz Fellow in Marketing in the University of Pittsburgh’s Joseph M. Katz Graduate School of Business and College of Business Administration.
In one of the first studies to use social media as a laboratory for social science experiments, Stephen and coauthor Olivier Toubia, the Glaubinger Professor of Business at Columbia University, questioned what motivates people to post tweets. Are Twitter users motivated by broadcasting their thoughts and opinions or, rather, by their desire to increase their social status by accumulating followers?
The results, published in the May/June issue of the peer-reviewed journalMarketing Science, provide insights into that question and have generated a surprising prediction of what the social network may operate like in the future.
To investigate the question, Stephen and Toubia identified approximately 2,500 Twitter users who were being followed by a range of other Twitter users, numbering from 13 to more than 10,000. All were noncorporate, noncelebrity users, and they were not tweeting for commercial purposes. Half the users were put into a control group, and the authors recorded daily data on the participants’ number of followers and their tweeting activity over a period of two months.
Stephen and Toubia then hired undergraduate research assistants to create 100 Twitter accounts. Following Twitter’s terms of service, the assistants added realistic-looking names and locations for these accounts, and they had the accounts follow one other as well as popular users like Lady Gaga and Justin Bieber. The assistants even sent out simple tweets—“It’s a pretty day today” or “The sky is blue”—to further support the illusion that the accounts were operated by real people.
Over the ensuing two months, the assistants used the new accounts to follow the users in the test group, gradually increasing each user’s list of followers by 100. The authors monitored these accounts to see how the increase in audience size affected the users’ tweeting activity.
Users who had few followers initially showed no change in their tweeting habits. Similarly, “high-end” users—those with as many as 10,000 followers—did not exhibit much change, likely because 100 additional followers was “a drop in the bucket,” Stephen said.
Among “mid-range” users, however, the authors noted significant changes in tweeting activity. “Users with 13 to 26 followers did increase activity,” said Stephen, speculating that these users were encouraged by the increase in followers to post more to a suddenly larger audience.
But users with slightly more followers—from 62 to 245—showed the opposite instinct, posting less as their followers increased. These users had already achieved some level of status, Stephen said, and wanted to preserve it by avoiding posting anything that would offend their followers. “As they get more followers,” he said, “they want to be careful about what they post.” These results indicated to the researchers that many users were more interested in gaining followers than in using Twitter to broadcast their views.
The trend of users posting less as they accumulated more followers led the authors to one of the more striking findings in the paper.
There is a natural tendency, Stephen explained, for active users to gain followers over time. Add to that the authors’ finding that users will post less as they gain followers, and it’s natural to conclude, Stephen said, that Twitter users are going to post less.
But commercial users, celebrities, and institutions like schools and sports teams, Stephen said, will continue to post information to the people who want it. “So what it becomes is another advertising channel, a broadcast medium, as opposed to a socially interactive one,” Stephen said.
Such a change is prevented, for now, by the influx of new users to the social media service. If Twitter should reach a point when no new users are signing up, the shift away from an interactive platform toward a one-way conduit for information would become more likely.
In such a scenario, Twitter would remain a viable channel for corporations, celebrities, and other high-end users to communicate with their fans, Stephen said. They might utilize their Twitter feeds the same way they use mailing lists to announce products and promotions to their followers.
“Longer term,” Stephen said, “to get value, they’ll need the people who start following them to react to these tweets and to retweet them.” But as his and Toubia’s model suggests, over time, regular users will be less likely to do so. Marketers using Twitter will be challenged to offer rewards and other incentives to engage users and counteract the tendency to tweet less, keeping the social network truly interactive.

Tuesday, May 14, 2013

Advertising Product Results? Put Images Closer Together

Consumers believe a product is more effective when images of the product and its desired outcome are placed closer together in advertisements, according to a new study in the Journal of Consumer Research.
“Merely changing the spatial proximity between the image of a product and its desired effect in an advertisement influences judgment of product effectiveness. Consumers tend to judge the product to be more effective when the two images are closer versus farther apart,” write authors Boyoun (Grace) Chae (University of British Columbia), Xiuping Li (National University of Singapore), and Rui (Juliet) Zhu (University of British Columbia).
Many advertisements promoting the effectiveness of a product show both a product image (anti-wrinkle cream) and an image of the promised results (a face without wrinkles). Objectively, the distance between the two images should not affect how consumers judge the product’s quality.
In a series of studies, consumers were asked to judge the effectiveness of a variety of products promising specific results (acne cream, pain reliever, nasal allergy spray, bug spray, fabric softener). Consumers tended to assume a product was more effective when its image was placed closer to that of its promised effect. The proximity of the images was more influential when consumers were less knowledgeable about a product category or when the results were expected sooner rather than later.
Companies should understand the subtle effect that spatial proximity between images has on consumer judgment of product effectiveness. When companies want to promote the immediate effects of their products, images of the product and its desired effect should be put closer to each other in an advertisement.
“The spatial proximity between visual representations of cause and effect in an advertisement can influence consumer judgments of product effectiveness. The closer the distance between an image of a product (an acne treatment) and that of its potential effect (a smooth face), the more effective consumers will judge the product to be,” the authors conclude. 

Saturday, May 11, 2013

Why we love it or hate it: The 3 E's

Why do brands such as Manchester United and Apple capture hearts and minds? When consumers feel a strong emotional attachment to a brand, there is seemingly nothing we would not do–from paying more for it to defending it against detractors. For all the millions of dollars spent on advertising and other efforts, however, consumers rarely feel an affinity for brands. So how do marketers make consumers develop a strong attachment for a product or service? According to a recent study from USC Marshall School of Business, it is achieved by appealing to people's aesthetic needs (enticing/annoying to the self), functional needs (enabling/disabling for the self) and spiritual needs (whether something is enriching/impoverishing). In short, brands to which we are loyal, evoke warm feelings and provide pleasure, speak to who we are and help manage the problems we have in daily life.
"Attachment-aversion (AA) model of customer-brand relationships," published in the Journal of Consumer Psychology and co-authored by USC Marshall's C. Whan Park, Joseph A. DeBell Chair in Business Administration and professor of marketing; Andreas B. Eisingerich, associate professor of marketing, Imperial College (London) Business School; and Jason Whan Park, Ph.D., University of Pittsburgh, identifies three factors that must be in place in order to build strong emotional attachment to brands and, conversely, limit aversion to a product or service. Marketers who want to build emotional affinity for their brands need to appeal to consumers on three fronts: strong aesthetics or self-enticing properties such as the taste of deep chocolate or the sleek design of a European car, have self-enabling benefits or the ability to solve customer problems (such as Swiss Army Knife, which allows one to feel power over one's environment) and self-enriching benefits or those that resonate with customers' beliefs or values and support their self-identities (activated for example, by location brands such as one's hometown, a membership to nonprofit or a luxury brand such as Rolex that is aspirational). These factors, the three E's—enticement, enablement and enrichment—are critical for all brands and their interplay determines our distance to the brand: whether we are more attached or have an aversion.
"There are many cases these days where people are very adverse to certain brands. This is a serious issue," said Park. "Why people become so antagonistic toward a brand is based on these three reasons, when it displeases them aesthetically or doesn't help them solve their daily problems or is contrary to their personal beliefs."
To test their attachment-aversion model, the researchers carefully developed the four-item scale of the attachment-aversion measure and conducted three studies, assessing consumer purchasing behavior over time, based on carefully chosen products: Apple, a product brand that draws strong consumer loyalty from their compelling design and emphasis on creativity; Manchester United, a soccer franchise that tends to generate extreme reactions in Great Britain (both positive and negative); and a grocery store chain in Austria. The scholars measured attachment and aversion by looking at attitudes and actions: what consumers would do for these brands, including defending them against criticism, participating in an affiliated charity event and feeling happy (sad) when good (bad) things happened to a brand. The researchers found that their model was better able to predict consumer reactions through not only their stated future intentions, but actual purchasing behavior during the final study.
Whether a brand was self-enriching was the stronger predictor of whether there would be a small distance/attachment or a larger distance/aversion to a brand. The researchers cite the strength of Nike's "Just Do It" as an example. In addition, the researchers also found that the older consumers were more motivated by self-enriching qualities of brands versus self-enticing benefits (aesthetic appeal), while the opposite was true for younger consumers.
The study also distinguished two other attitudes towards brands that marketers need to address quite differently: the mixed (both positive and negative) perceptions of a brand and indifference. Brand managers need to focus on reducing the distance between customers and a brand, by examining how much value customers perceive from the current offering of a brand with respect to those three E's.
"Great brands simultaneously offer sensory pleasure and self-pride. Sensory pleasure comes from the self-enticing product cues (e.g., product design, package design, color, brand logo, etc.). Self-pride comes from two different sources: self-enabling benefits of a product and self-enriching message of a brand," said Park.
Self-enabling benefits provide a boost of self-efficacy and self-confidence. "That's when you feel proud of yourself—when you can deal with daily problems without difficulty and feel secure," said Park. "Self-enriching messages of a brand makes you feel good about yourself because you relate yourself to its moral values and philosophies."

Tuesday, May 7, 2013

We almost always buy in the same shops

Consumers are a lot more predictable than they seem. This is the main discovery of an international scientific study, in which the Universidad Carlos III of Madrid (UC3M) has participated, which reveals how to predict people’s shopping patterns.
This research study attempts to identify just how predictable we consumers are with respect to shopping patterns. As explained by one of its authors, Esteban Moro of the Department of Mathematics at UC3M, “the main conclusion we have drawn is that people’s behavior is repetitive when it comes to visiting and spending in shops, and as such it is possible to have some success in predicting where we are going to buy in the future”. Published in Scientific Reports, the open journal of the Nature group, the study was also produced by scientists from the Universidad Autónoma de Madrid, the University of California in San Diego (U.S.A), M.I.T (Massachusetts Institute of Technology) and NICTA (Australia).
In order to carry out the study, researchers analyzed hundreds of thousands of de-identified economic transactions made with credit cards on both sides of the Atlantic. The goal was to find the ´predictability’ of the time series of consumption in almost a year’s worth of credit card purchases made by more than 50 million accounts. “What we found”- the researcher points out- “is that people are quite regular when visiting (and purchasing in shops and that there is quite a bit of ´predictability’, above all in the long term”. To put it another way, it is difficult to predict where your next purchase will be on the basis of where you are doing your shopping now. However, as Professor Moro indicates, it is possible to know with a fair degree of probability where you will go shopping during the next month. In short: we go back to the same shops with remarkable regularity.
As pointed out by the researchers, the study has various applications that range from geomarketing (marketing in specific areas of the city), provision of points of sale, locating cash tellers or detecting fraud. There is still not enough information available to the researchers as to whether this data can be extrapolated to cash operations.
Over the past few years there has been a good deal of research on the ‘predictability’ of social behavior. By using different data sources (telephones, Wi-Fi points, GPS data, etc.), many groups of scientists have studied how predictable our mobility is- that is, the routes, walks and places that we use to move about in the city. While this mobility is determined by the tasks we have to carry out throughout the day (going to work, going home, etc.), there are also many variables throughout the day that are not completely predictable (where to, take out money, etc.). As Esteban Moro puts it, “our goal was to try to observe to what extent this ‘predictability’ also exists in economic decisions (how much and where I use the credit card). Although they are conditioned by our daily mobility, these decisions have a completely different dimension.”

Monday, May 6, 2013

The Rational Consumer

Does the rational consumer exist, or is shopping just a result of chemical reactions?


Sunday, May 5, 2013

Hubspot Magazine May/June 2013

Read it for free by clicking here.o