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Customer social network affects marketing strategy: A simulation analysis based on competitive diffusion model

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  • Hou, Rui
  • Wu, Jiawen
  • Du, Helen S.

Abstract

To explain the competition phenomenon and results between QQ and MSN (China) in the Chinese instant messaging software market, this paper developed a new population competition model based on customer social network. The simulation results show that the firm whose product with greater network externality effect will gain more market share than its rival when the same marketing strategy is used. The firm with the advantage of time, derived from the initial scale effect will become more competitive than its rival when facing a group of common penguin customers within a social network, verifying the winner-take-all phenomenon in this case.

Suggested Citation

  • Hou, Rui & Wu, Jiawen & Du, Helen S., 2017. "Customer social network affects marketing strategy: A simulation analysis based on competitive diffusion model," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 469(C), pages 644-653.
    • Handle: RePEc:eee:phsmap:v:469:y:2017:i:c:p:644-653
    DOI: 10.1016/j.physa.2016.11.110
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    References listed on IDEAS

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    Cited by:

    1. Jie Gu & Yunjie Xu, 2022. "Battle of positioning: exploring the role of bridges in competitive diffusion," Journal of Computational Social Science, Springer, vol. 5(1), pages 319-350, May.
    2. Geng, Yang & Zhang, Yulin, 2020. "Platform launch in two-sided markets and users’ expectations," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 558(C).
    3. Smaldone, Francesco & Ippolito, Adelaide & Ruberto, Margherita, 2020. "The shadows know me: Exploring the dark side of social media in the healthcare field," European Management Journal, Elsevier, vol. 38(1), pages 19-32.

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