Complex Contagion in Viral Marketing: Causal Evidence from a Country- Scale Field Experiment

44 Pages Posted: 2 May 2022 Last revised: 24 Apr 2023

See all articles by Jaemin Lee

Jaemin Lee

The Chinese University of Hong Kong (CUHK) - Department of Sociology

David Lazer

Northeastern University - Department of Political Science; Harvard University - Harvard Kennedy School (HKS)

Christoph Riedl

Northeastern University - D’Amore-McKim School of Business

Date Written: April 24, 2022

Abstract

The diffusion of new products and services among consumers is a foundational issue in marketing. Research on complex contagions in product diffusion suggests that individuals need social reinforcement from multiple sources before they are convinced to adopt new products or services. We develop a conceptualization of social reinforcement using an adoption force equation and then empirically test its causal foundation in a country-scale randomized controlled viral marketing field experiment. The experiment used a peer encouragement design in which a randomly sampled set of customers were randomly encouraged to share a coupon for a mobile data product with their friends. We analyze the data from our experiment using three different analysis methods to confront empirical challenges of causally identifying social influence in social networks. Across all three methods we consistently find robust evidence of social reinforcement: the contagion process can no longer be seen as independent cascades but instead a process in which signals from multiple sources amplify each other. While the effect of social reinforcement is quite large, we show that the ability to harness this amplification effect in a realistic setting may be limited when the marketer cannot directly control the messages that customers send to their friends.

Keywords: Complex Contagion, Word of Mouth, New Product Diffusion, Social Networks, Field Experiment, Social Influence

Suggested Citation

Lee, Jaemin and Lazer, David and Riedl, Christoph, Complex Contagion in Viral Marketing: Causal Evidence from a Country- Scale Field Experiment (April 24, 2022). Northeastern U. D’Amore-McKim School of Business Research Paper No. 4092057, Available at SSRN: https://ssrn.com/abstract=4092057 or http://dx.doi.org/10.2139/ssrn.4092057

Jaemin Lee

The Chinese University of Hong Kong (CUHK) - Department of Sociology ( email )

The Chinese University of Hong Kong
Hong Kong, 000 000
Hong Kong

David Lazer

Northeastern University - Department of Political Science ( email )

Boston, MA 02115
United States
617-373-2796 (Phone)
617-373-5311 (Fax)

Harvard University - Harvard Kennedy School (HKS) ( email )

79 John F. Kennedy Street
Taubman Center
Cambridge, MA 02138
United States
617-496-0102 (Phone)
617-496-1722 (Fax)

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

Christoph Riedl (Contact Author)

Northeastern University - D’Amore-McKim School of Business ( email )

360 Huntington Ave.
Boston, MA 02115
United States

HOME PAGE: http://www.christophriedl.net

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