Herding and Social Media Word-of-Mouth: Evidence from Groupon

X. LI, L. WU

MIS Quarterly

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Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Herding, word-of-mouth, social media, interaction effect, complementarity

Modern online retailing practices provide consumers with new types of real-time information that can potentially increase demand. In particular, showing past product sales information can reduce uncertainty about product quality, inducing consumers to herd. This effect could be particularly salient for experience goods due to their inherent high uncertainty about product quality. Social media word-of-mouth (WOM) can increase product awareness as product information spreads via social media, increasing demand directly and also amplifying existing quality signals such as past sales. This study examines the mechanisms behind the strategy of facilitating herding and the strategy of integrating social media platforms to understand the potential complementarities between the two strategies. We conduct empirical analysis using data from which sells goods in a fast cycle format of “daily deals”. We find that facilitating herding and integrating social media platforms are complements in generating sales, supporting that it is beneficial to combine the two strategies on social media-driven platforms. Furthermore, we find that herding is more salient for experience goods, consistent with our hypothesized mechanisms, while the effect of social media WOM does not differ between experience goods and search goods

Impact of Average Rating on Social Media Endorsement: The Moderating Role of Rating Dispersion and Discount Threshold


Information Systems Research

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Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Is your valley as green as it should be? Incorporating economic development into environmental performance indicators


Clean Technologies and Environmental Policy

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Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Social Presence in Virtual World Collaboration: An Uncertainty Reduction Perspective Using a Mixed Methods Approach


MIS Quarterly

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Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Virtual worlds, uncertainty reduction theory, institutional trust, sequential mixed methods

The life-like collaborative potential offered by virtual worlds (VWs) has sparked significant interest for companies to experiment with VWs in order to organize convenient, cost-effective virtual global workplaces. Despite the initial hype, recent years have witnessed a rather stagnant use of VWs for collaboration in organizations. Previous research recognizes that the inherent uncertainties within the VW environment are factors limiting their utilization by businesses. Hence, grounding this research in uncertainty reduction theory (URT), we aim to understand the modalities and mechanisms for mitigating the uncertainties and fostering user trust within VWs so that they can be effectively utilized as a workplace collaboration tool. With this end in view, we propose contextualizing and extending McKnight et al.’s (2002) institutional trust framework to the context of VWs by examining the significant role that social presence has in influencing the efficacy of the institution-based trust-building factors of situational normality and structural assurance in VWs. Using a sequential mixed methods approach (Venkatesh et al. 2013; Venkatesh et al. 2016), this research integrates results from a quantitative study with findings from a qualitative study to arrive at rich and robust inferences and meta-inferences, with the qualitative method first corroborating the inferences obtained from the quantitative research and then complementing them by identifying boundary conditions that may limit the use of VWs in organizations for workplace collaboration. The results together suggest not only the direct, but also the interactional (complementary and substitutive) influences of social presence on the relationships of the two institutional-trust-building factors to user trust in VWs

An Integrated Revenue Management Framework for a Firm's Greening, Pricing and Inventory Decisions


International Journal of Production Economics

janvier 2018, vol. 195, pp.373-390

Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Environment, Newsvendor problem, Pricing, Market segmentation, Distribution-free approach

There is a growing interest on developing efficient ways of incorporating environmental considerations into business practices in order to meet both consumers' demand for green products/services, and the firms' sustainable profitability. The main contribution of this article is in developing an integrated revenue management framework to address a firm's greening (investment) effort, pricing and inventory decisions. It is assumed that the firm inaugurates a green product along with its existing product. Even though the firm offers both the green and regular product at differentiated prices, the market segmentation as a result of this price differentiation is regarded as imperfect. This imperfect market segmentation causes a demand leakage mainly due to the heterogeneity among the customers' willingness-to-pay. These effects are included in our proposed model and simplified analytical solutions are developed to solve the same. Additional scenarios where a firm experiences a price-dependent stochastic demand with an unknown distribution is also modeled. This scenario is addressed using a distribution-free approach based on Scarf' s rule. The performance of the proposed methods and the significance of the modeling framework are finally corroborated through several simulations. This analysis provides a sustainable environment, production and retailing framework while still augmenting profitability using fundamental tools from revenue management

Collaborative Prototyping of Alternative Designs Under a Target Costing Scheme


Production and Operations Management

mars 2018, vol. 27, n°3, pp.496–515

Départements : Information Systems and Operations Management

Mots clés : Collaborative prototyping, Parallel and sequential testing, Supplier involvement, Target costing

Prototyping allows firms to evaluate the technical feasibility of alternative product designs and to better estimate their costs. We study a collaborative prototyping scenario in which a manufacturer involves a supplier in the prototyping process by letting the supplier make detailed design choices for critical components and provide prototypes for testing. While the supplier can obtain private information about the costs, the manufacturer uses target costing to gain control over the design choice. We show that involving the supplier in the prototyping process has an important influence on the manufacturer's optimal decisions. The collaboration results in information asymmetry, which makes parallel prototyping less attractive and potentially reverses the optimal testing sequence under sequential prototyping: It may be optimal to test designs in increasing order of attractiveness to avoid that the supplier does not release technically and economically feasible prototypes for strategic reasons. We also find that the classical target costing approaches (cost- and market-based) need to be adjusted in the presence of alternative designs: Due to the strategic behavior of suppliers, it is not always optimal to provide identical target costs for designs with similar cost and performance estimates, nor to provide different target costs for dissimilar designs. Furthermore, the timing is important: While committing upfront to carefully chosen target costs reduces the supplier's strategic behavior, in some circumstances, the manufacturer can take advantage of this behavior by remaining flexible and specifying the second prototype's target costs later

Construction of Relations with Distant Suppliers on the Cognitive and Relational Dimensions to Co-Explore Discontinuous Innovations / Construction des relations avec des fournisseurs distants sur les plans cognitifs et relationnels pour co-explorer des in


Innovations, Revue d’économie et de management de l'innovation

2018, vol. 1, n°55, pp.61-87

Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : innovation discontinue, implication des fournisseurs, fournisseurs distants, open innovation, exploration, organisation ambidextre / discontinuous innovation, suppliers contribution, distant suppliers, open innovation, exploration, organizational ambidextry

Co-explorer des concepts avec des fournisseurs distants, sur les plans cognitifs et relationnels, favorise l’identification d’innovations discontinues. Cependant, peu de travaux s’intéressent aux modalités de construction de ces relations. Sur la base d’une étude longitudinale d’une entreprise qui a co-exploré des innovations discontinues avec des fournisseurs distants, nous mettons en évidence de manière inductive deux caractéristiques du processus et de l’organisation adoptée pour construire ces relations. Nous soulignons la transparence du processus de co-exploration qui soutient un engagement progressif mutuel. Ce processus est porté par un acteur dédié, ayant accès à la fois aux experts techniques ainsi qu’aux dirigeants de l’entreprise qui prennent les décisions stratégiques en matière de domaines d’innovation et de développement. Cet acteur est ainsi un des vecteurs de l’ambidextrie organisationnelle de l’entreprise puisqu’il permet le développement de ces relations parallèlement aux relations de long terme avec des partenaires privilégiés

Incentive programs for reducing readmissions when patient care is co-produced


Production and Operations Management

juin 2018, vol. 27, n°6, pp.999-1020

Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Co-productive services, hospital readmissions, pay-for-performance, bundled payment

To reduce preventable readmissions, many healthcare systems are transitioning from Fee-for-Service (FFS) to other reimbursement schemes such as Pay-for-Performance (P4P) or Bundled Payment (BP) so that the funder of a healthcare system can transfer to the hospital some of the financial risks associated with patient re-hospitalizations. To examine the effectiveness of different schemes (FFS, P4P, and BP), we develop a "health co-production" model in which the patient's readmissions can be "jointly controlled" by the efforts exerted by both the hospital and the patient. Our analysis of the equilibrium outcomes reveals that FFS cannot entice the hospital and the patient to exert readmission-reduction efforts. Relative to BP, we find that P4P is more "robust" in the sense that it can induce readmission-reduction efforts under milder conditions. However, BP can induce greater efforts compared to P4P. More importantly, we characterize the conditions under which BP (or P4P) is the dominant scheme from the funder's perspective. Finally, we find that patient cost-sharing can generate two benefits: (a) it provides incentive for patients to exert efforts; and (b) if not excessive, it can reduce the readmission rate

Investigating the drivers for social commerce in social media platforms: Importance of trust, social support and the platform perceived usage


Journal of Retailing and Consumer Services

mars 2018, vol. 41, pp.11-19

Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Social commerce; S-vendors; Trust; Social media; Social support; UTAUT2 Model

This study sheds light on the drivers of social commerce in social media platforms. First, it explores the perceived characteristics of the social commerce vendor and investigates their influence on users’ trust. Second, it tests the influence of trust and the platform perceived usage (using the Unified Technology Acceptance and Use of Technology Model 2) on social commerce intent. Data from a survey of Instagram users, within the Golf Corporation Council countries, were collected online. Results show that reputation and price advantage have the strongest influence on trust, although those effects are weakened by habits. Contrary to expectations, social interactions with the social commerce vendor decrease trust. Similarly, product differentiation reduces trust. Nevertheless, this effect is negatively moderated by social support. Perceived ease of use of the platform, facilitating conditions, hedonic motives and habits increase social commerce intent. The findings of this research offer some insights on the mechanisms through which the s-vendor characteristics influence social commerce intent on social media platforms. Findings help businesses better understand the social commerce landscape and improve their marketing strategies

Key Factors in Building a Corporate Accelerator Capability: Developing an effective corporate accelerator requires close attention to the relationships between startups and the sponsoring company


Research Technology Management: international journal of research management

2018, vol. 61, n°4, pp.26-34

Départements : Information Systems and Operations Management, GREGHEC (CNRS)

Mots clés : Open innovation, Accelerators, Corporate venturing

Since the creation of the first innovation accelerator, Y Combinator, in 2005, corporate accelerators are increasingly being adopted as a way for established firms to source innovation from startups. However, few studies have addressed the drivers of successful accelerators. This case study examines the experience of an established, global firm that launched 12 corporate accelerators between 2013 and 2016. The findings highlight two critical factors in building an effective corporate acceleration capacity: 1) designing a differentiated value proposition for startups based on the capitalization of corporate assets, and 2) developing a specific process to manage the relationships between the corporation and the startups involved in the accelerator. One strong mechanism increasing the potential for success is the assignment of dedicated business developers who can act as boundary spanners and oversee relationships to ensure that the interests of both parties converge