Acquisition of Customer Information and Corporate Decision Making

63 Pages Posted: 18 Jan 2024 Last revised: 16 Dec 2024

See all articles by Elia Ferracuti

Elia Ferracuti

Duke University - Fuqua School of Business

Minjae Koo

Korea University Business School

Mary Lee

ESSEC Business School

Stephen Stubben

University of Utah

Date Written: January 2, 2024

Abstract

This study examines whether and under what conditions customer data collected through mobile apps—primarily for marketing purposes—aids investing and operating decisions. We find that following the introduction of a mobile app, management earnings and revenue guidance is more accurate. After firms release a mobile app, firms exhibit less underinvestment in capital assets and less overinvestment in inventory, particularly when they have effective internal information systems and access to location and financial information about their customers. These findings are consistent with the notion that information obtained through mobile apps leads to improved forecasts of customer demand and thus more efficient investing and operating decisions. We also find that privacy regulations intended to protect customers restrict firms’ ability to access these efficiency gains.

Keywords: mobile apps, customer data, privacy, operating decisions, investing decisions

JEL Classification: G31, M41, D83

Suggested Citation

Ferracuti, Elia and Koo, Minjae and Lee, Mary and Stubben, Stephen, Acquisition of Customer Information and Corporate Decision Making (January 2, 2024). HKU Jockey Club Enterprise Sustainability Global Research Institute - Archive, Available at SSRN: https://ssrn.com/abstract=4682350 or http://dx.doi.org/10.2139/ssrn.4682350

Elia Ferracuti

Duke University - Fuqua School of Business ( email )

Box 90120
Durham, NC 27708-0120
United States
919-660-1974 (Phone)

Minjae Koo

Korea University Business School ( email )

Seoul
Korea, Republic of (South Korea)

Mary Lee

ESSEC Business School ( email )

3 Avenue Bernard Hirsch
CS 50105 CERGY
CERGY, CERGY PONTOISE CEDEX 95021
France

Stephen Stubben (Contact Author)

University of Utah ( email )

1655 E. Campus Center
Salt Lake City, UT 84112
United States

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