This paper uncovers the striking power of a product’s first consumer review. Our analytical model suggests that two key metrics of online consumer reviews, valence and volume, are not independent, but instead evolve interdependently. This interdependence forms a mechanism to transfer a...

In search advertising, we observe different patterns of branded keyword purchase behavior by the brand owner and its competitor. In particular, under a specific branded keyword, we may observe in the sponsored link, only the brand owner, only the competitor, both, or neither. In this paper, we...

In keyword search advertising, many advertisers operate on a limited budget. Yet how limited budgets affect keyword search advertising has not been extensively studied. This paper offers an analysis of the generalized second-price auction with budget constraints. We find that the budget...

Technology transfer offers global firms an opportunity to reduce the costs involved in serving emerging markets as well as to source from low-cost locations for their home markets. However, it also poses a potential risk of imitation by local competitors who may enter the market(s). We introduce...

Network effects and standards competition introduce significant uncertainty into consumers' new-product adoption decisions, creating a substantial challenge to the success of innovating firms. While the literature has highlighted the importance of establishing a large installed-user base (the...

This paper examines the interplay of social and temporal distance on consumers’ responses to others’ recommendations. Drawing on research on psychological distance and the “fit” literature, the authors hypothesize that others’ recommendation is more persuasive when the construal levels...

Technology transfer to low cost locations offers global firms an opportunity to reduce their variable costs involved in serving emerging markets. However, such moves may also make imitation by local competitors easier. As a consequence, technology transfer may create competition in the local...

This paper examines a unique selling strategy, Group Buying, under which consumers enjoy a discounted group price if they are willing and able to achieve a required group size and coordinate their transaction time. We argue that Group Buying allows a seller to gain from facilitating consumer...

Performance-based advertising is becoming increasingly popular in the online advertising industry, where the advertiser pays to the publisher only when an "action" (e.g., a click-through) is generated by the advertisement. We study how the performance-based advertising scheme affects one of the...