Building Agent-Based Decision Support Systems for Word-of-Mouth Programs. A Freemium Application

Journal of Marketing Research, Forthcoming

46 Pages Posted: 12 Aug 2016 Last revised: 15 Mar 2017

Manuel Chica

Open University of Catalunya (UOC) (Open University of Catalonia) - Internet Interdisciplinary Institute (IN3); The University of Newcastle, Australia

William Rand

North Carolina State University

Date Written: August 10, 2016

Abstract

Marketers have to make decisions on how to implement word-of-mouth (WOM) programs and a well-developed decision support system (DSS) can provide them with valuable assistance. The authors propose an agent-based framework that aggregates social network-level individual interactions to guide the construction of a successful DSS for WOM. The framework presents a set of guidelines and recommendations to involve stakeholders, follow a data-driven iterative modeling approach, increase validity through automated calibration, and understand the DSS behavior. This framework is applied to build a DSS for a freemium app, where premium users discuss the product with their social network and promote the viral adoption. After its validation, the agent-based DSS forecasts the aggregate number of premium sales over time and the most likely users to become premium in a near future. The experiments show how the DSS can help managers by forecasting premium conversions and increasing the number of premiums via targeting and rewarding policies.

Keywords: Word-of-mouth, Marketing Decision Support Systems, Agent-based Modeling, Targeting and Referrals, Freemium Business Model

Suggested Citation

Chica, Manuel and Rand, William, Building Agent-Based Decision Support Systems for Word-of-Mouth Programs. A Freemium Application (August 10, 2016). Journal of Marketing Research, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2821171 or http://dx.doi.org/10.2139/ssrn.2821171

Manuel Chica (Contact Author)

Open University of Catalunya (UOC) (Open University of Catalonia) - Internet Interdisciplinary Institute (IN3) ( email )

Barcelona
Spain

The University of Newcastle, Australia ( email )

University Drive
Callaghan, NSW 2308
Australia

HOME PAGE: http://www.manuchise.com

William Rand

North Carolina State University ( email )

Poole College of Management
Box 7229, North Carolina State University
Raleigh, NC North Carolina 27695-7229
United States
7347177965 (Phone)

HOME PAGE: http://billrand.org

Paper statistics

Downloads
83
Rank
251,239
Abstract Views
368