IDEAS home Printed from https://ideas.repec.org/a/inm/ormksc/v34y2015i3p408-429.html
   My bibliography  Save this article

Social Contagion in New Product Trial and Repeat

Author

Listed:
  • Raghuram Iyengar

    (The Wharton School, University of Pennsylvania, Philadelphia, Pennsylvania, 19104)

  • Christophe Van den Bulte

    (The Wharton School, University of Pennsylvania, Philadelphia, Pennsylvania, 19104)

  • Jae Young Lee

    (School of Business, Yonsei University, Seoul 120-749, Republic of Korea)

Abstract

The notion of peer influence in new product adoption or trial is well accepted. We propose that peer influence may affect repeat behavior as well, though the process and source of influence are likely to differ between trial and repeat. Our analysis of the acceptance of a risky prescription drug by physicians provides three novel findings. First, there is evidence of contagion not only in trial but also in repeat. Second, who is most influential varies across stages. Physicians with high centrality in the discussion and referral network and with high prescription volume are influential in trial but not repeat. In contrast, immediate colleagues, few of whom are nominated as a discussion or referral partner, are influential in both trial and repeat. Third, who is most influenceable also varies across stages. For trial, it is physicians who do not consider themselves to be opinion leaders, whereas for repeat, it is those located towards the middle of the status distribution as measured by network centrality. The pattern of results is consistent with informational social influence reducing risk in trial and normative social influence increasing conformity in repeat.

Suggested Citation

  • Raghuram Iyengar & Christophe Van den Bulte & Jae Young Lee, 2015. "Social Contagion in New Product Trial and Repeat," Marketing Science, INFORMS, vol. 34(3), pages 408-429, May.
  • Handle: RePEc:inm:ormksc:v:34:y:2015:i:3:p:408-429
    DOI: 10.1287/mksc.2014.0888
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1287/mksc.2014.0888
    Download Restriction: no

    File URL: https://libkey.io/10.1287/mksc.2014.0888?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Szymanowski, Maciej & Gijsbrechts, Els, 2013. "Patterns in consumption-based learning about brand quality for consumer packaged goods," International Journal of Research in Marketing, Elsevier, vol. 30(3), pages 219-235.
    2. Hinz, Oliver & Skiera, Bernd & Barrot, Christian & Becker, Jan, 2011. "Seeding Strategies for Viral Marketing: An Empirical Comparison," Publications of Darmstadt Technical University, Institute for Business Studies (BWL) 56543, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL).
    3. Levin, Sharon G & Levin, Stanford L & Meisel, John B, 1992. "Market Structure, Uncertainty, and Intrafirm Diffusion: The Case of Optical Scanners in Grocery Stores," The Review of Economics and Statistics, MIT Press, vol. 74(2), pages 345-350, May.
    4. Lien, Da-Hsiang Donald & Rearden, David, 1990. "A Remark on 'An Advantage of the Linear Probability Model over Probit or Logit.'," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 223-225, May.
    5. Haenlein, Michael, 2013. "Social interactions in customer churn decisions: The impact of relationship directionality," International Journal of Research in Marketing, Elsevier, vol. 30(3), pages 236-248.
    6. David Godes & Dina Mayzlin, 2009. "Firm-Created Word-of-Mouth Communication: Evidence from a Field Test," Marketing Science, INFORMS, vol. 28(4), pages 721-739, 07-08.
    7. Bearden, William O & Netemeyer, Richard G & Teel, Jesse E, 1989. "Measurement of Consumer Susceptibility to Interpersonal Influence," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 15(4), pages 473-481, March.
    8. Poirier, Dale J. & Ruud, Paul A., 1981. "On the appropriateness of endogenous switching," Journal of Econometrics, Elsevier, vol. 16(2), pages 249-256, June.
    9. Emily Oster & Rebecca Thornton, 2012. "Determinants Of Technology Adoption: Peer Effects In Menstrual Cup Take-Up," Journal of the European Economic Association, European Economic Association, vol. 10(6), pages 1263-1293, December.
    10. Christophe Van den Bulte & Yogesh V. Joshi, 2007. "New Product Diffusion with Influentials and Imitators," Marketing Science, INFORMS, vol. 26(3), pages 400-421, 05-06.
    11. Sinan Aral, 2011. "Commentary--Identifying Social Influence: A Comment on Opinion Leadership and Social Contagion in New Product Diffusion," Marketing Science, INFORMS, vol. 30(2), pages 217-223, 03-04.
    12. Ricardo Montoya & Oded Netzer & Kamel Jedidi, 2010. "Dynamic Allocation of Pharmaceutical Detailing and Sampling for Long-Term Profitability," Marketing Science, INFORMS, vol. 29(5), pages 909-924, 09-10.
    13. Aral, Sinan & Muchnik, Lev & Sundararajan, Arun, 2013. "Engineering social contagions: Optimal network seeding in the presence of homophily," Network Science, Cambridge University Press, vol. 1(2), pages 125-153, August.
    14. Christophe Van den Bulte & Stefan Stremersch, 2004. "Social Contagion and Income Heterogeneity in New Product Diffusion: A Meta-Analytic Test," Marketing Science, INFORMS, vol. 23(4), pages 530-544, July.
    15. Anderson, G. J., 1987. "Prediction tests in limited dependent variable models," Journal of Econometrics, Elsevier, vol. 34(1-2), pages 253-261.
    16. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521766555.
    17. Yansong Hu & Christophe Van den Bulte, 2014. "Nonmonotonic Status Effects in New Product Adoption," Marketing Science, INFORMS, vol. 33(4), pages 509-533, July.
    18. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521747387.
    19. Bicchieri,Cristina, 2006. "The Grammar of Society," Cambridge Books, Cambridge University Press, number 9780521573726.
    20. Yingda Lu & Kinshuk Jerath & Param Vir Singh, 2013. "The Emergence of Opinion Leaders in a Networked Online Community: A Dyadic Model with Time Dynamics and a Heuristic for Fast Estimation," Management Science, INFORMS, vol. 59(8), pages 1783-1799, August.
    21. Christophe Van den Bulte & Raghuram Iyengar, 2011. "Tricked by Truncation: Spurious Duration Dependence and Social Contagion in Hazard Models," Marketing Science, INFORMS, vol. 30(2), pages 233-248, 03-04.
    22. Martin, William C. & Lueg, Jason E., 2013. "Modeling word-of-mouth usage," Journal of Business Research, Elsevier, vol. 66(7), pages 801-808.
    23. Bicchieri,Cristina, 2006. "The Grammar of Society," Cambridge Books, Cambridge University Press, number 9780521574907.
    24. David Bell & Sangyoung Song, 2007. "Neighborhood effects and trial on the internet: Evidence from online grocery retailing," Quantitative Marketing and Economics (QME), Springer, vol. 5(4), pages 361-400, December.
    25. Herbert C. Kelman, 1958. "Compliance, identification, and internalization three processes of attitude change," Journal of Conflict Resolution, Peace Science Society (International), vol. 2(1), pages 51-60, March.
    26. Molitor, Dominik & Hinz, Oliver & Wegmann, Sarah, 2011. "The Interplay between Psychometric and Sociometric Data and the Willingness to Adopt New Products," Publications of Darmstadt Technical University, Institute for Business Studies (BWL) 56547, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL).
    27. Prabhakant Sinha & Andris A. Zoltners, 2001. "Sales-Force Decision Models: Insights from 25 Years of Implementation," Interfaces, INFORMS, vol. 31(3_supplem), pages 8-44, June.
    28. Nicholas A. Christakis & James H. Fowler, 2011. "Commentary--Contagion in Prescribing Behavior Among Networks of Doctors," Marketing Science, INFORMS, vol. 30(2), pages 213-216, 03-04.
    29. Minhi Hahn & Sehoon Park & Lakshman Krishnamurthi & Andris A. Zoltners, 1994. "Analysis of New Product Diffusion Using a Four-Segment Trial-Repeat Model," Marketing Science, INFORMS, vol. 13(3), pages 224-247.
    30. Kenneth Train, 2003. "Discrete Choice Methods with Simulation," Online economics textbooks, SUNY-Oswego, Department of Economics, number emetr2.
    31. Prosser, Helen & Walley, Tom, 2006. "New drug prescribing by hospital doctors: The nature and meaning of knowledge," Social Science & Medicine, Elsevier, vol. 62(7), pages 1565-1578, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yansong Hu & Christophe Van den Bulte, 2014. "Nonmonotonic Status Effects in New Product Adoption," Marketing Science, INFORMS, vol. 33(4), pages 509-533, July.
    2. Zhang, Honghong & Fam, Kim-Shyan & Goh, Tiong-Thye & Dai, Xin, 2018. "When are influentials equally influenceable? The strength of strong ties in new product adoption," Journal of Business Research, Elsevier, vol. 82(C), pages 160-170.
    3. Gächter, Simon & Gerhards, Leonie & Nosenzo, Daniele, 2017. "The importance of peers for compliance with norms of fair sharing," European Economic Review, Elsevier, vol. 97(C), pages 72-86.
    4. Raghuram Iyengar & Christophe Van den Bulte & Thomas W. Valente, 2011. "Opinion Leadership and Social Contagion in New Product Diffusion," Marketing Science, INFORMS, vol. 30(2), pages 195-212, 03-04.
    5. Kölle, Felix & Quercia, Simone, 2021. "The influence of empirical and normative expectations on cooperation," Journal of Economic Behavior & Organization, Elsevier, vol. 190(C), pages 691-703.
    6. Jing Wang & Anocha Aribarg & Yves F. Atchadé, 2013. "Modeling Choice Interdependence in a Social Network," Marketing Science, INFORMS, vol. 32(6), pages 977-997, November.
    7. Nejad, Mohammad G. & Amini, Mehdi & Babakus, Emin, 2015. "Success Factors in Product Seeding: The Role of Homophily," Journal of Retailing, Elsevier, vol. 91(1), pages 68-88.
    8. Muller, Eitan & Peres, Renana, 2019. "The effect of social networks structure on innovation performance: A review and directions for research," International Journal of Research in Marketing, Elsevier, vol. 36(1), pages 3-19.
    9. Bryan Bollinger & Kenneth Gillingham & A. Justin Kirkpatrick & Steven Sexton, 2022. "Visibility and Peer Influence in Durable Good Adoption," Marketing Science, INFORMS, vol. 41(3), pages 453-476, May.
    10. Viswanathan, Vijay & Sese, F. Javier & Krafft, Manfred, 2017. "Social influence in the adoption of a B2B loyalty program: The role of elite status members," International Journal of Research in Marketing, Elsevier, vol. 34(4), pages 901-918.
    11. Felix Kölle & Thomas Lauer, 2020. "Understanding Cooperation in an Intertemporal Context," ECONtribute Discussion Papers Series 046, University of Bonn and University of Cologne, Germany.
    12. Peres, Renana & Muller, Eitan & Mahajan, Vijay, 2010. "Innovation diffusion and new product growth models: A critical review and research directions," International Journal of Research in Marketing, Elsevier, vol. 27(2), pages 91-106.
    13. Rode, Johannes & Müller, Sven, 2016. "Spatio-Temporal Variation in Peer Effects - The Case of Rooftop Photovoltaic Systems in Germany," Publications of Darmstadt Technical University, Institute for Business Studies (BWL) 84765, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL).
    14. Paulina Oliva & B. Kelsey Jack & Samuel Bell & Elizabeth Mettetal & Christopher Severen, 2020. "Technology Adoption under Uncertainty: Take-Up and Subsequent Investment in Zambia," The Review of Economics and Statistics, MIT Press, vol. 102(3), pages 617-632, July.
    15. Oryani, Bahareh & Koo, Yoonmo & Shafiee, Afsaneh & Rezania, Shahabaldin & Jung, Jiyeon & Choi, Hyunhong & Khan, Muhammad Kamran, 2022. "Heterogeneous preferences for EVs: Evidence from Iran," Renewable Energy, Elsevier, vol. 181(C), pages 675-691.
    16. Hinz, Oliver & Schulze, Christian & Takac, Carsten, 2014. "New product adoption in social networks: Why direction matters," Journal of Business Research, Elsevier, vol. 67(1), pages 2836-2844.
    17. Ashutosh Tiwari & Timothy J. Richards, 2016. "Social Networks and Restaurant Ratings," Agribusiness, John Wiley & Sons, Ltd., vol. 32(2), pages 153-174, April.
    18. van Ewijk, Bernadette J. & Gijsbrechts, Els & Steenkamp, Jan-Benedict E.M., 2022. "The dark side of innovation: How new SKUs affect brand choice in the presence of consumer uncertainty and learning," International Journal of Research in Marketing, Elsevier, vol. 39(4), pages 967-987.
    19. Chul-Yong Lee & Min-Kyu Lee, 2017. "Demand Forecasting in the Early Stage of the Technology’s Life Cycle Using a Bayesian Update," Sustainability, MDPI, vol. 9(8), pages 1-15, August.
    20. Shan Huang & Sinan Aral & Yu Jeffrey Hu & Erik Brynjolfsson, 2020. "Social Advertising Effectiveness Across Products: A Large-Scale Field Experiment," Marketing Science, INFORMS, vol. 39(6), pages 1142-1165, November.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:ormksc:v:34:y:2015:i:3:p:408-429. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.