This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

Long Tail or Steep Tail? A Field Investigation into How Online Popularity Information Affects the Distribution of Customer Choices

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Tucker, Catherine
Zhang, Juanjuan

Additional information is available for the following registered author(s):

Abstract

The internet has made it easier for customers to find and buy a wide variety of products. This may lead to a "long tail" effect as more customers buy low-volume products. However, the internet has also made it easier for customers to find out which products are most popular. This could lead to a "steep tail" effect as customers flock towards the most popular products. Using data from a field experiment with a website that lists wedding service vendors, we find empirical evidence that a steep tail exists. The most popular vendors become more popular when customers can easily observe previous customers' click-through behavior. Then, we ask whether this steep tail effect "complements" the long tail, by attracting customers who would otherwise have chosen nothing, or "competes with" the long tail, by shifting customers from less popular vendors to popular ones. We find evidence of a complementary effect, where the steep tail indicates new interest in the most popular vendors from outside, with negligible cannibalization of interest for less popular vendors. The findings suggest that popularity information can serve as a powerful marketing tool that facilitates product category growth. They also explain the prevalence of firm practices to highlight bestsellers.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://hdl.handle.net/1721.1/39811
File Format: application/pdf
File Function:
Download Restriction: no

Publisher Info
Paper provided by Massachusetts Institute of Technology (MIT), Sloan School of Management in its series Working papers with number 39811.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length:
Date of creation: 07 Dec 2007
Date of revision:
Handle: RePEc:mit:sloanp:39811

Contact details of provider:
Postal: MASSACHUSETTS INSTITUTE OF TECHNOLOGY (MIT), SLOAN SCHOOL OF MANAGEMENT, 50 MEMORIAL DRIVE CAMBRIDGE MASSACHUSETTS 02142 USA
Phone: 617-253-2659
Web page: http://mitsloan.mit.edu/
More information through EDIRC

Order Information:
Postal: MASSACHUSETTS INSTITUTE OF TECHNOLOGY (MIT), SLOAN SCHOOL OF MANAGEMENT, 50 MEMORIAL DRIVE CAMBRIDGE MASSACHUSETTS 02142 USA

For technical questions regarding this item, or to correct its listing, contact: (Christian Zimmermann).

Related research
Keywords: Long Tail; Steep Tail; Customer Learning; Decisions Under Uncertainty; Internet Marketing; Category Management;

Other versions of this item:

This paper has been announced in the following NEP Reports: References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Anderson, Lisa R & Holt, Charles A, 1997. "Information Cascades in the Laboratory," American Economic Review, American Economic Association, vol. 87(5), pages 847-62, December. [Downloadable!] (restricted)
  2. Judith A. Chevalier & Dina Mayzlin, 2003. "The Effect of Word of Mouth on Sales: Online Book Reviews," NBER Working Papers 10148, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  3. Jerry A. Hausman & Bronwyn H. Hall & Zvi Griliches, 1984. "Econometric Models for Count Data with an Application to the Patents-R&D Relationship," NBER Technical Working Papers 0017, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  4. Rosen, Sherwin, 1981. "The Economics of Superstars," American Economic Review, American Economic Association, vol. 71(5), pages 845-58, December. [Downloadable!] (restricted)
  5. Banerjee, Abhijit V, 1992. "A Simple Model of Herd Behavior," The Quarterly Journal of Economics, MIT Press, vol. 107(3), pages 797-817, August. [Downloadable!] (restricted)
  6. Brynjolfsson, Erik & Smith, Michael D. & Yu, (Jeffrey) Hu, 2003. "Consumer Surplus in the Digital Economy: Estimating the Value of Increased Product Variety at Online Booksellers," Working papers 4305-03, Massachusetts Institute of Technology (MIT), Sloan School of Management. [Downloadable!]
  7. Daniel Fleder & Kartik Hosanagar, 2007. "Blockbuster Culture's Next Rise or Fall: The Impact of Recommender Systems on Sales Diversity," Working Papers 07-10, NET Institute, revised Sep 2007. [Downloadable!]
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Guillermo De Haro, 2008. "Cuando una ´long tail´ no es suficiente," Working Papers Economia wpe08-16, Instituto de Empresa, Area of Economic Environment. [Downloadable!]
Statistics
Access and download statistics

Did you know? IDEAS was launched in September 1997.

This page was last updated on 2009-11-12.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.