The role of online buzz for leader versus challenger brands: the case of the MP3 player market

Hyun Song Shin, Dominique M. Hanssens and Kyoo il Kim ()
Additional contact information
Dominique M. Hanssens: UCLA Anderson School of Management
Kyoo il Kim: Michigan State University

Electronic Commerce Research, 2016, vol. 16, issue 4, No 4, 503-528

Abstract: Abstract Online buzz reflects the perceived quality of products in a positive, negative, or neutral way. We have limited understanding of how customers’ quality perceptions, often referred to as e-sentiment, affect the movement of prices. In this paper, we examine the effect of e-sentiment on the daily price fluctuations of MP3 players by using daily buzz information collected from diverse online documents. Econometric panel data modeling reveals that e-sentiment is a leading indicator of price fluctuations. Furthermore, we find the effect is moderated by the brand’s market position: the leading (challenger) brand’s price responds more strongly to negative (positive) online buzz. In other words, negative buzz has a greater adverse effect on leading brands, whereas positive buzz has a greater beneficial effect on challenger brands. These findings establish the relevance of e-sentiment information to online price movements and suggest that managers should frequently monitor the online buzz surrounding their products, especially as it relates to their relative perceived quality.

Keywords: Online buzz; E-sentiment; Quality perceptions; Price fluctuations; Market position (search for similar items in EconPapers)
Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://link.springer.com/10.1007/s10660-016-9218-7 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:elcore:v:16:y:2016:i:4:d:10.1007_s10660-016-9218-7

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/10660

DOI: 10.1007/s10660-016-9218-7

Access Statistics for this article

Electronic Commerce Research is currently edited by James Westland

More articles in Electronic Commerce Research from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().