Document Type

Article

Publication Date

4-21-2014

Abstract

We leverage the newly emerging business analytical capability to rapidly deploy and iterate large-scale, microlevel, in vivo randomized experiments to understand how social influence in networks impacts consumer demand. Understanding peer influence is critical to estimating product demand and diffusion, creating effective viral marketing, and designing “network interventions” to promote positive social change. But several statistical challenges make it difficult to econometrically identify peer influence in networks. Though some recent studies use experiments to identify influence, they have not investigated the social or structural conditions under which influence is strongest. By randomly manipulating messages sent by adopters of a Facebook application to their 1.3 million peers, we identify the moderating effect of tie strength and structural embeddedness on the strength of peer influence. We find that both embeddedness and tie strength increase influence. However, the amount of physical interaction between friends, measured by coappearance in photos, does not have an effect. This work presents some of the first large-scale in vivo experimental evidence investigating the social and structural moderators of peer influence in networks. The methods and results could enable more effective marketing strategies and social policy built around a new understanding of how social structure and peer influence spread behaviors in society.

Comments

This is a pre-copy-editing, author-produced PDF of an article accepted for publication in Management Science, volume 60, issue 6, in 2014 following peer review. This article may not exactly replicate the final published version. The definitive publisher-authenticated version is available online at https://doi.org/10.1287/mnsc.2014.1936

Peer Reviewed

1

Copyright

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