The Use and Value of Social Information in Selective Selling of Exclusive Products

• 成果类型: Article
• 署名作者: Momot, Ruslan; Belavina, Elena; Girotra, Karan
• 署名单位: Hautes Etudes Commerciales (HEC) Paris; Cornell University
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2019.3310
• 发表日期: 2020
• 页码: 2610-2627
• 关键词: Social networks; luxury retail; E-commerce

摘要

We consider the use and value of social-network information in selectively selling goods and services whose value derives from exclusive ownership among network connections or friends. Our model accommodates customers who are heterogeneous in their number of friends (degree) and their proclivity for social comparisons (conspicuity). Firms with information on either (or both) of these characteristics can use it to make the product selectively available and to personalize prices. We find that firms' preferred customers are low degree and high conspicuity, with the conspicuity threshold nondecreasing in degree. Interestingly, although both degree and conspicuity levels are relevant to curating the desired customer base, we find that firms do not need conspicuity information to do so; its absence can be substituted by incentivizing customers to self-select. There is no such recourse for the absence of degree information. As a result, degree information is typically more valuable than conspicuity information. Our analysis suggests that there are two canonical categories of social information-less valuable consonant information on characteristics where firm and customer preferences are aligned and more valuable competing information where preferences are misaligned. Customers can be incentivized to act in a way that their actions are a perfect substitute for consonant information, making it less valuable.