Brand Crisis and Customer Relationship Management on Social Media: Evidence from a Natural Experiment from the Airline Industry

2023 | Information Systems Research | Citations: 0

Authors: Al Balawi, Ramah; Hu, Yuheng; Qiu, Liangfei

Abstract: In this study, we investigate the effect of a brand crisis on the customer relat ... Expand

Abstract: In this study, we investigate the effect of a brand crisis on the customer relationship management (CRM) efforts of brands on social media. Despite the opportunities social media offers to brands to connect and engage with customers, it is still unclear how a brand crisis can change a brand’s social CRM efforts. Social media platforms can amplify the negative consequences of a brand crisis. However, the unique and public nature of social media platforms can offer new means for brands to handle a brand crisis and publicly manage their customer relationships. Compared with traditional CRM, social media enables brands to communicate with their customers publicly, which can strengthen their relationships with customers and maintain higher levels of customer engagement. Leveraging a natural experiment setting, we investigate the impact of the United Airlines crisis on three dimensions of social CRM efforts: informativeness, timeliness, and attentiveness. Contrary to traditional CRM efforts and recommendations, we find that the brand crisis increases informativeness efforts but reduces timeliness and attentiveness efforts.History: Yong Tan, Senior Editor; Beibei Li, Associate Editor.Supplemental Material: The online appendix is available at https://doi.org/10.1287/isre.2022.1159. Collapse

Topics: social media Twitter customer service customer satisfaction customer relationship management

Methods: mediation analysis longitudinal research robustness check natural experiment experimental group

The Effect of Consensus Algorithm on Ethereum Price and Volume

2023 | Americas Conference on Information Systems | Citations: 0

Authors: Ampel, Benjamin

Abstract: Cryptocurrencies, such as Bitcoin and Ethereum, are digital currencies operatin ... Expand

Abstract: Cryptocurrencies, such as Bitcoin and Ethereum, are digital currencies operating on a peer-to-peer network. Cryptocurrencies rely on consensus algorithms for transaction validation and network security. Ethereum recently replaced its proof-of-work (PoW) consensus algorithm with a proof-of-stake (PoS) algorithm on September 15, 2022. This research aims to study the following research question: Does changing from PoW to PoS consensus increase price and transaction volume? To answer this question, we implemented synthetic control methods to compare the pre-and post-treatment trends of the price and volume of Ethereum against a synthetic counterfactual. The result of our analysis suggests that Ethereum shifting from PoW to PoS had a positive effect on its price and a non-significant negative effect on transaction volume. Price increasing relative to the synthetic counterfactual is promising for convincing other PoW blockchains that a switch to PoS may lead to increased investment opportunities while decreasing the environmental impact. Collapse

Topics: Ethereum cryptocurrency Bitcoin knowledge base decision making

Methods: computational algorithm experiment synthetic control method experimental group longitudinal research

The Consequences of Rating Inflation on Platforms: Evidence from a Quasi-Experiment

2023 | Information Systems Research | Citations: 0

Authors: Aziz, Arslan; Li, Hui; Telang, Rahul

Abstract: Informative online ratings enable digital platforms to reduce the search cost fo ... Expand

Abstract: Informative online ratings enable digital platforms to reduce the search cost for buyers to find good sellers. However, rating inflation, a phenomenon in which average rating increases and rating variance across listings decreases, threatens the informativeness of ratings. We empirically identify the consequences of rating inflation by conducting a quasi-experiment with a digital platform that exogenously changed its rating display rule in a treated neighborhood, which resulted in rating inflation. Using a differences-in-differences approach, we find that platforms benefit from one aspect of rating inflation: user purchases and seller sales increase because of the increased average rating. However, they also face negative consequences: rating inflation causes a decrease in user trial and a greater concentration of sales among popular restaurants. Overall, our results illustrate the potential consequences of rating inflation that platforms need to consider when designing and managing their rating system.History: Xiaoquan (Michael) Zhang, Senior Editor; Gordon Burtch, Associate Editor.Supplemental Material: The online appendices are available at https://doi.org/10.1287/isre.2022.1134. Collapse

Topics: digital platform mobile application word of mouth ease of use consumer behavior

Methods: experiment pilot experiment experimental group robustness check quasi experiment

The Power of Identity Cues in Text-Based Customer Service: Evidence from Twitter

2023 | Management Information Systems Quarterly | Citations: 0

Authors: Gao, Yang; Rui, Huaxia; Sun, Shujing

Abstract: Text-based customer service is emerging as an important channel through which c ... Expand

Abstract: Text-based customer service is emerging as an important channel through which companies can assist customers. However, the use of few identity cues may cause customers to feel limited social presence and even suspect the human identity of agents, especially in the current age of advanced algorithms. Does such a lack of social presence affect service interactions? We studied this timely question by evaluating the impact of customers' perceived social presence on service outcomes and customers' attitudes toward agents. Our identification strategy hinged on Southwest Airlines' sudden requirement to include a first name in response to service requests on Twitter, which enhanced customers' perceived level of social presence. This change led customers to become more willing to engage and more likely to reach a resolution upon engagement. We further conducted a randomized experiment to understand the underlying mechanisms. We found that the effects were mainly driven by customers who were ex ante uncertain or suspicious about the human identity of agents, and the presence of identity cues improved service outcomes by enhancing customers' perceived levels of trust and empathy. Additionally, we found no evidence of elevated verbal aggression from customers toward agents with identity cues, although a mechanism test revealed the moderating role of customers' emotional states. Our study highlights the importance of social presence in text-based customer service and suggests a readily available and almost costless strategy for firms: signal humanization through identity cues. Collapse

Topics: customer service Twitter social presence social media customer satisfaction

Methods: experiment computational algorithm synthetic control method survey support vector machine

Theories: social presence theory big five model

CIO Turnover and its Consequences for Competitors

2023 | Americas Conference on Information Systems | Citations: 0

Authors: Jeong, Yeasung; Lee, Kang-Bok; Han, Sumin; Park, Young Woong; Park, Junyoung

Abstract: As information technology is considered a key driver of firm's innovation, the ... Expand

Abstract: As information technology is considered a key driver of firm's innovation, the role of a chief information officer (CIO) has been emphasized. However, firms face frequent CIO turnover. Thus, in this study, we argue that it is important to investigate the impact of CIO turnover on a firm's innovativeness, and the spillover effect of CIO turnover on competitors' innovativeness. We then propose a novel approach to testing these causal inferences of CIO turnover. We found that CIO turnover did not have a significant direct effect on its focal firm. However, the spillover effect is significant and positive, implying that firms produce more patents when their competitors experience CIO turnover than if CIOs at competing firms had not been dismissed. Since losing a CIO has ripple effects throughout the whole industry, firms should consider the unintended consequences of their decisions regarding CIO turnover. Collapse

Topics: Chief Information Officer innovation management database system IT leadership software patent

Methods: experimental group Compustat synthetic control method causality analysis

Theories: signaling theory

The Value of Centralized IT in Building Resilience During Crises: Evidence from U.S. Higher Education’s Transition to Emergency Remote Teaching

2023 | Management Information Systems Quarterly | Citations: 0

Authors: Park, Jiyong; Son, Yoonseock; Angst, Corey

Abstract: The COVID-19 pandemic forced organizations, including higher education institut ... Expand

Abstract: The COVID-19 pandemic forced organizations, including higher education institutions, to rapidly adjust their operations. In the face of the pandemic, most higher education institutions shut down their campuses and transitioned to emergency remote teaching mode. This study examines digital resilience in higher education institutions through the conceptual lens of disaster response management, by assessing the role played by the centralized governance of information technology (IT) investments. We posit that centralized IT helps organizations maintain customer satisfaction with services during a crisis (e.g., student satisfaction with classes during COVID-19) by facilitating the organization-wide transition to an emergency operational mode and supporting its service operations. Consolidating data on IT investment, governance, and course evaluations from 463 U.S. higher education institutions from 2017-2020, we show that centralized IT helped organizations adapt better to the pandemic in terms of maintaining student satisfaction. Moreover, we found that centralized IT investments geared toward facilitating organizational coordination and providing instructional and technical support played a pivotal role in enabling ERT and improving student ratings during the crisis. These results are corroborated by interviews with CIOs of U.S. higher education institutions. Additional analyses also suggest that the effectiveness of centralized IT governance is contingent upon organizational size, dissimilarity of local units, and the strategic role of the CIO. We also discuss theoretical extensions toward digital resilience as well as practical implications. Collapse

Topics: IT investment pandemic IT centralization covid 19 Chief Information Officer

Methods: qualitative interview experimental group robustness check survey longitudinal research

What shall I learn? Two-stage decision making under social influence on corporate E-learning platforms

2023 | Decision Support Systems | Citations: 0

Authors: Song, Yiping Amy; Zhang, Lingling; Ma, Liye; Bose, Indranil

Abstract: E-learning platforms have increasingly been adopted by corporate employees in th ... Expand

Abstract: E-learning platforms have increasingly been adopted by corporate employees in the workplace. On these plat­ forms, users typically follow a two-stage decision-making process: they first choose which content to learn and then decide how much to continue learning. The decisions of individual employee users are influenced by members of the same workplace organization (group influence) and general users on the platform from other organizations (mass influence). Extant research has not shown how different types of social influence impact different decisions. Using data from a corporate e-learning platform, this study examines how group influence and mass influence support employees’ learning decisions, from the perspective of the elaboration likelihood model (ELM). The results reveal that mass users’ past choices only influence low-elaborative choice decisions but not high-elaborative engagement decisions. In contrast, workgroup members’ past choices influence both the low-elaborative choice and high-elaborative engagement decisions. Furthermore, positive synergy exists between the two types of social influence for the choice decision, but the synergy dissipates for the engagement decision. These findings can help online content platforms design appropriate information-sharing systems to influence users’ choice and engagement decisions. The results can also help corporates take advantage of social influence to motivate employees to engage in work-related online learning. Collapse

Topics: social influence online learning system decision making decision support system logistics management

Methods: descriptive statistic robustness check case control study synthetic control method paired t-test

Theories: elaboration likelihood model

Does regulation help? The impact of California‘s AB5 on Gig Workers

2023 | HICSS | Citations: 0

Authors: Wang, Xunyi; Lin, Yu-Wei; Han, Wencui

Abstract: There is a widespread debate over how gig workers should be classified. The pass ... Expand

Abstract: There is a widespread debate over how gig workers should be classified. The passage of California Assembly Bill 5 (AB5) - a landmark legislation that aims to correct the misclassification of gig workers, has significant implications for workers, platforms, regulators, and the economy. In this research, leveraging the passage of AB5 as a shock for a natural experiment, we empirically investigate the impact of AB5 on gig workers in California to provide insights. With the data collected from a leading online labor market that connects clients and gig workers, we applied a Difference in Difference approach, and we found that the monthly earnings of gig workers in California, compared to those in other states, have a significantly higher increase after AB5 was signed into law. This effect stems from both increased daily earnings and increased working days. We discuss the implications for policymakers and platforms. Collapse

Topics: platform worker covid 19 legal context online labor market platform work site

Methods: experimental group natural experiment propensity score method robustness check synthetic control method

When More Can Be Less: The Effect of Add-On Insurance on the Consumption of Professional Services

2023 | Information Systems Research | Citations: 0

Authors: Li, Hongfei; Peng, Jing; Li, Xinxin; Stallaert, Jan

Abstract: The emergence of online platforms for professional services (e.g., cosmetic proc ... Expand

Abstract: The emergence of online platforms for professional services (e.g., cosmetic procedures) represents a natural progression of e-commerce from search and experience goods to credence goods. Because of the deeply consequential nature of professional services and the large information asymmetries between customers and service providers, designing effective risk-reduction strategies is crucial for facilitating digital transactions of professional services. In this paper, we study whether and how the introduction of a novel risk-reduction strategy, the add-on insurance covering the potential cost of negative consequences (e.g., complications and unsatisfactory outcomes), affects the demand for professional services in online platforms. We leverage a policy change in an online platform for cosmetic procedures, which started to offer the add-on insurance for a subset of cosmetic procedures in 2016. Our empirical analysis shows that this risk-reduction strategy has asymmetric effects on low- and high-risk procedures. Specifically, the introduction of insurance increases the sales of low-risk procedures, but not those of high-risk ones. More importantly, the insurance has a negative spillover effect on uninsured competitors of insured procedures, regardless of their risk levels. The negative spillover effect of insurance on high-risk procedures is noteworthy because it hurts the sales of their uninsured competitors without increasing their own sales, suggesting that the negative spillover effect goes beyond the typical demand cannibalization explanation and can decrease the overall demand for high-risk procedures. We further corroborate our findings and investigate the mechanisms behind the asymmetric treatment effects and the negative spillover effect using an online controlled experiment. Our findings have important implications for platforms to design, deploy, and evaluate their risk-reduction strategies.History: Eric Zheng, Senior Editor; Pallab Sanyal, Associate Editor.Supplemental Material: The online appendix is available at https://doi.org/10.1287/isre.2022.1129. Collapse

Topics: digital platform online review Twitter decision making electronic commerce

Methods: experiment qualitativ observational study experimental group quantitative observational study robustness check

Bank Error in Whose Favor? A Case Study of Decentralized Finance Misgovernance

2022 | International Conference on Information Systems | Citations: 0

Authors: Ke, Ping Fan; Ng, Ka Chung Boris

Abstract: Decentralized Finance (DeFi) emerged rapidly in recent years and provided open ... Expand

Abstract: Decentralized Finance (DeFi) emerged rapidly in recent years and provided open and transparent financial services to the public. Due to its popularity, it is not uncommon to see cybersecurity incidents in the DeFi landscape, yet the impact of such incidents is under-studied. In this paper, we examine two incidents in DeFi protocol that are mainly caused by misgovernance and mistake in the smart contract. By using the synthetic control method, we found that the incident in Alchemix did not have a significant effect on the total value locked (TVL) in the protocol, whereas the incident in Compound caused a 6.13% decrease in TVL. One factor that contributed to the difference in the result could be the incident response in social media platforms, and further study should investigate the possible moderating or mediating effects of public opinions and sentiment. Collapse

Topics: decentralized finance social media smart contract blockchain Twitter

Methods: synthetic control method econometric modeling longitudinal research case study time series analysis