Engaging New Users with Introductory Incentives: Evidence from an Online Health Community

Posted: 14 Aug 2017 Last revised: 1 Mar 2019

See all articles by Xiaofei Zhang

Xiaofei Zhang

Business School, Nankai University

Wei Chen

University of Arizona - Eller College of Management

Bin Gu

Arizona State University (ASU) - Department of Information Systems

Xitong Guo

Harbin Institute of Technology

Date Written: August 10, 2017

Abstract

This paper studies the impact of short-term introductory incentives on new users’ retention and contribution in online communities. We draw on a policy change in a large online health community to compare new physicians who are affected by the policy versus those who are not. Based on the literature of online community and prospect theory, we find that (1) introductory incentives can increase user retention through newcomer activation, (2) even though introductory incentives increase contribution quantity and quality during the policy window, such incentives can significantly decrease contribution quantity in the long run, and (3) the effects of such incentives are contingent on users’ offline seniority, which creates opportunities for the platform to target different user groups with different incentives. These results are consistent in various robustness checks using different methods. This research contributes to the literature on identifying the impacts of introductory incentives and inter-temporal change of monetary incentives on new users’ activation, retention, and contribution in online communities. The findings also provide managerial insights into the design of monetary incentives in online communities.

Keywords: Online Communities, Introductory Incentives, User Acquisition, User Contribution, User Retention, Seniority Contingency

Suggested Citation

Zhang, Xiaofei and Chen, Wei and Gu, Bin and Guo, Xitong, Engaging New Users with Introductory Incentives: Evidence from an Online Health Community (August 10, 2017). Available at SSRN: https://ssrn.com/abstract=2705270

Xiaofei Zhang

Business School, Nankai University ( email )

94 Weijin Road
Tianjin, 300071
China

Wei Chen (Contact Author)

University of Arizona - Eller College of Management ( email )

McClelland Hall
P.O. Box 210108
Tucson, AZ 85721-0108
United States

Bin Gu

Arizona State University (ASU) - Department of Information Systems ( email )

Tempe, AZ
United States

Xitong Guo

Harbin Institute of Technology ( email )

huanghe road
harbin, heilongjiang 150001
China

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