Proceedings of the 42nd Hawaii International Conference on System Sciences - 2009 Agents of Diffusion Insights from a Survey of Facebook Users Rebecca Ermecke CDTM, LMU Munich [email protected] Philip Mayrhofer CDTM, LMU Munich [email protected] Abstract In times of web 2.0 and its strong focus on user interaction in business models, entrepreneurs and investors of internet businesses often back up their ambitious growth expectations with the argument of viral distribution. However, there exists little evidence on the determinants of consumers willingness to voluntarily and actively exchange information about internet applications. Based on survey data of 475 Facebook users, this paper makes a contribution to fill this gap. Key findings are that passive (observation of other users) and active (purposeful recommendations from peers) viral channels are equally important to make users aware of a novel product. Active viral channels, however, dominate in convincing users to actually start using a product or service. We also find that users are altruistically motivated to recommend applications and predominantly use built-in invitation mechanisms in the application as a communication channel for recommendations. This paper contributes to the field of electronic marketing in two ways. First and foremost it brings forward empirical evidence on the interpersonal aspects of the mechanisms behind viral distribution and word-of-mouth marketing. Second, it presents the illustrative case of Facebook which has become a fore-runner in online marketing when it comes to taking into account user interaction and behavior. 1. Introduction The term viral refers to the observation that information about new products seem to spread like a virus from one person to another without any central coordination mechanisms. Depending on individuals inclination to pass on the information they received, this distribution mechanism can result in an exponential increase in infected, i.e. informed, subjects. Viral distribution of product information relies on social influence in the sense that actions of an individual A affect another individual B in her beliefs or actions. Stefan Wagner INNO-tec, LMU Munich [email protected] The purpose of this paper is twofold: First, it examines how different forms of social influence make other people aware of a new product or service and impact someones subsequent decision whether or not to adopt it. We will distinguish between two different types of social influence depending on the role of the influencing person. The influencing person is said to be passive if she exerts influence on others indirectly, e.g. by displaying the results of her own adoption decision in a transparent manner. In contrast, the influencing person is said to be active if she undertakes a purposeful attempt to influence others to also add an application, e.g. by explicitly inviting her friends to install the application. In principle, the information on novel products in online social networks could be spread through passive viral channels as other peoples actions are transparent to their peers as well as through active viral channels as most web-based applications include tools for an easy generation of recommendations through a myriad of online communication features. It is the aim of this paper to examine the relative importance of these inherently different channels for both the spread of information on new products as well as for the adoption decision of individuals. The second objective of the paper is the analysis of those people who actively recommend certain products or features and pass on information to their peers. From a firms perspective, knowing what segments of consumers are more likely to actively disseminate information on their products is highly relevant. Based on this knowledge specific marketing activities can be tailored to this segment of users in order to foster viral spread of information related to a firms products. The paper proceeds as follows: Section 2 provides a review of the literature in the realm of viral marketing and social influence. The background and research environment of the study are introduced in Section 3. Section 4 discusses our methodological approach and describes the sample that was used for the empirical analysis. Section 5 finally presents results from our empirical analysis. It also derives implications relevant for interested scholars as well 978-0-7695-3450-3/09 $25.00 © 2009 IEEE 1 Proceedings of the 42nd Hawaii International Conference on System Sciences - 2009 as practitioners. Section 6 summarizes findings and implications and concludes with a brief discussion of possible limitations of the study that suggest further research. 2. Literature review Rogers [1] identifies consumers social system and communication channels as important determinants of the diffusion of innovations. Furthermore, he stresses the importance of an individuals perception of the characteristics of an innovation. One of the most important characteristics from a consumers perspective is the relative advantage of an innovation compared to previously available products; perceived personal benefit derived from the adoption of an innovation must be superior compared to an existing system of use. Moreover, perceived ease of use facilitates adoption, whereas more complex innovations, and those that are difficult to understand and to use, typically need more time to spread. As an innovation by its very definition is something new and previously unknown, it involves uncertainty for the individual and possibly brings about risk in its adoption. The lower the perceived risk of adoption the faster is its diffusion. We will use this framework to relate users perceptions to their adoption decisions as well as to their propensity to recommend innovations to their peers. Social influence between individuals, in general, works independently of third-parties, such as firms. In the marketing literature, however, various concepts that aim at managing and commercially exploiting social influence can be found and are often subsumed under the term viral marketing. This literature argues that one of the most important success factors of viral marketing campaigns is to not to frame it in an overly intrusive way. Subramani and Rajagopalan [2] note that the unwise use of viral marketing can be counterproductive and shed a negative light on products. It is essential, that influencers are perceived as knowledgeable helpers among their peers instead of just marketing agents of some company. Schemes that make too obvious and clumsy attempts to encourage users to promote products and services are likely to destroy the balance and reduce the effectiveness of the approach which hurts both the company and the users who may have derived value from the knowledge-sharing acts of influencers [2]. The concept of word-of-mouth marketing (WOM) is closely related to viral marketing and is often used synonymously. WOM is defined as informal, person-to-person communication between a perceived non-commercial communicator and a receiver regarding a brand, a product, an organization, or a service [3]. It aims at spreading marketing messages virally among potential customers. Whereas earlier studies focused on faceto-face communication, the Internet makes it now easier to connect to more peers and on a more frequent basis. Web 2.0 with its focus on social interaction brings about novel communication channels over which product information are transmitted. Mechanisms to forward digital products, recommend them to friends or comment on them are becoming industry standard. Social influence should, thus, be even more compelling and pervasive than in conventional, interpersonal interactions [2]. These activities play an important role as both informational and normative social influence [4] have an impact on peers buying decisions [5] and thus often lead to conformity within a network [6]. Exposure to favorable word of mouth was found to increase the probability of purchase of a food product, whereas exposure to unfavorable comments decreased the probability [7]. In the same study word-of-mouth communication was not motivated by a desire to exert active influence on others but rather to exchange opinions about a product. Bone [8] examined the influence of word of mouth on shortterm and long-term product judgments in an experimental setting. She finds that this influence is more significant the source of the WOM communication is an expert. Furthermore, her results suggest that personal characteristics such as general susceptibility to interpersonal influence and product knowledge do not appear to significant factors of the effectiveness of WOM. In a study of the adoption of a new telecommunication service [9], Hill et al. show that consumers linked to a prior customer adopt the service at a 3-5 times higher rate than customers from a reference group. Leskovec et al. [5] analyze a person-to-person recommendation network, and find that usually recommendations are not very effective at triggering purchases and do not spread very far (p.1). Most recommendation chains do not grow very large; rather they end with the first purchase of a product. Sometimes, however, a product will be broadcasted throughout a very active recommendation network (p.3). The authors further find that an individuals likelihood of purchasing a product initially increases with the number of people recommending it to them, but a saturation point is quickly reached and additional recommendations do not result in a greater propensity to buy a product (p.3). From a firms perspective it is particularly interesting to know the determinants of customers 2 Proceedings of the 42nd Hawaii International Conference on System Sciences - 2009 willingness to voluntarily spread information on its products. Possible explanations include individuals eagerness to share enthusiasm and frustration with their peers and their increased joy of consuming the good based on the possibility to discuss, rave, slaughter and define themselves by the things they like [10]. It has also been argued by [11] and [12] that network externalities provide a rationale for recommend products and services. Hill et al. [9] note that some consumers value the appearance of being on the cutting edge or in the know, and therefore derive satisfaction from promoting new, exciting products. Furthermore, there might be some kind of extrinsic motivation to stimulate adoption among peers created through a reward scheme of the producer. Socio-demographic attributes, i.e. gender were also found to be an explanatory variable of active recommendation behavior. Phelps et al. [13] found females to be much more active in forwarding passalong e-mails. Likewise, Feick and Price [14] found market mavens more likely to be female in a sample of U.S. consumers and Wiedmann et al. [15] in a sample of German consumers, although the latter propose that this is about to change with increasingly blurred gender-models (p.195). of the platform and, therefore, to enforce viral tendencies. Recently, large social networks opened their platform for third parties: Software developers have been allowed to write and to distribute applications that are based on the platforms APIs (application programming interface) and their technical infrastructure. As a consequence, third-party applications can easily be installed individually by users and integrate seamlessly into their user accounts on the platform. Once third party applications are installed they can access a users address book. Based on this information many third party applications provide their users with easy ways to pass on information to a users friends implemented as recommend this-buttons. Most often, applications diffuse within social networks through user recommendations based on these mechanisms. In the following we describe how we aim to derive information on the mechanics of the nature of viral recommendations within this setting by analyzing the diffusion of novel third-party applications on Facebooks social network. 3. Third-party applications on Facebook Our empirical analysis is based on a survey of users of Facebook, a large internet-based social network which is open for third-party developers. Originally, when Facebook was launched in February 2004 (www.facebook.com) it was exclusively for Harvard students. It soon opened for other colleges and high schools (September 2005) and finally for anyone with an email address (September 2006). In May 2007, Facebook opened the technical infrastructure of its website so that external developers could write additional applications providing additional functionality to Facebook users. Very soon after Facebooks initiative, competing major social network platforms announced to open their infrastructure (Google followed in November 2007 and MySpace in March 2008). By January 2008, Facebook accounted for more than 50 million active users which can create profiles that include pictures, contact information and interests. Access to user profiles can be restricted to members of the same college, high school or work network and to friends that have been actively acknowledged. Facebook aims at mapping out real and pre-existing connections among people [16]. For many younger users Facebook serves as the central portal to stay up-to-date on activities in their personal network (via the News Feed, a list of friends recent activities). 3.1. Background: social networks turn to programming platforms Online social networks1 provide users with a range of functions to manage their personal contacts and to organize their private and business life based on these contacts. Beyond mere messaging functionalities, users can create customized profile pages containing various types of content ranging from professional and personal information, pictures or even schedules of planned future activities. There are two features common to most internetbased social networks which are important for the following study. First, many social networks contain automated news feeds informing users on updates on their friends profiles pages including their adoption of certain services offered on the platform. Second, they contain mechanisms to pass on information (e.g. recommendations) easily to their friends on the platform based on predefined recommend-thisfunctionalities. These two features can be expected to accelerate the exchange of information among users 1 Prominent examples include MySpace, Facebook, Bebo, Orkut, LinkedIn or Plaxo. 3.2. Object of study: Facebook application platform 3 Proceedings of the 42nd Hawaii International Conference on System Sciences - 2009 Technically, developers of third party applications write web-based applications that are integrated in Facebook but are hosted on servers provided by the third party. In the simplest case, an application is a piece of web content (e.g. a slide show of pictures) but it can also be a sophisticated web application with a complex functionality (e.g. an interactive game one can play with other users). After an application is registered with Facebook, users can easily install and use it. Three aspects make Facebooks platform attractive to developers. First, the degree of integration and access to Facebooks functionality is unprecedented. Facebook also offers convenient tools facilitating the development of applications. Second, applications can integrate functionality that enables them to virally activate Facebooks existing user base as they access users address books. In fact, users can send invitations to their friends easily within applications providing different forms of recommend-this buttons. Facebook also shows a notification when friends install new applications in the news feed contained in users profiles. Third, Facebook allows developers to monetize their applications without charging a commission. The description of different business models related to the provision of applications for Facebook is beyond the scope of this paper. However, we want to highlight that often applications are used as a mean to promote services offered by third-parties outside of Facebook. For example, applications can generate revenues as Facebook allows the inclusion of advertisements (e.g. Google Ads) in the applications. By February 2008, more than 15,000 applications were registered with Facebook. Facebook reports on its web page that more than 90% of Facebooks users have installed and used an application at least once and the most successful applications are being used by more than one million users daily. Diffusion of some of the early applications has been very rapid with achieving more than 850,000 users within three days [17]. Even though achieving comparable growth rates has become harder with more applications competing for users attention, the number of new applications provided by third parties is steadily increasing. Based on the characteristics of Facebooks platform described above, we believe that this setting provides an excellent environment for the study of the role individuals play for the diffusion of novel products. The setting allows an easy separation of passive (observation of peers behavior either on their profile pages or via updates in the news-feed) and active forms (receipt of recommendations or messages) of social influence as described in Section 1. Facebook includes a variety of channels which can be used to influence peers. Whereas some are still specific to Facebook, others (e.g. the News Feed) have been adopted by most other social networks. This makes Facebook an innovative object to study, yet generalizable for other existing and future networks and web applications. 4. Methodology and sample 4.1. Methodology: case-study setup and triangulation Our research follows a case study approach [18, 19] that uses different sources of information that contribute to a better understanding of viral marketing and social influence. The use of multiple data sources is a common approach in studies that focus on (innovative) social communities (compare, e.g. [20]). The major advantage of this approach is that it allows for the examination of a novel phenomenon from various angles, i.e. through triangulation [21, 22, 23]. In a first explorative step, we became accustomed to the environment of Facebook as a social network as well as with the community of application developers. Explorative interviews were conducted with both application users and developers. Apart from casual conversations in various occasions, three explicit, yet unstructured interviews were conducted with developers of popular applications. They provided insights on the design of applications, particularly with the focus on features that facilitate viral growth. Moreover, we conducted five unstructured interviews with users of Facebook which provided insights regarding their general Facebook usage behavior. The more important objective of these user interviews was to get detailed information on the decision-making process preceding the installation of applications as well as the decision to actively recommend applications to friends. In a second step, we conducted an online survey of Facebook users with regard to the adoption of third party applications and the recommendation of those applications. The questionnaire was based on the insights from the explorative interviews as well as on a thorough literature review. It was developed in December 2007 and pretested in various stages. The pretesting involved both paper-based questionnaires as well as an electronic version of the survey. Our final questionnaire contained a total of 47 questions. Respondents were confronted with a choice of nine applications and were requested to pick one application they had heard of. In the course 4 Proceedings of the 42nd Hawaii International Conference on System Sciences - 2009 of the survey all the questions would then relate to this chosen application. If the respondent had not heard of any of the given applications, she would be redirected to a base set of questions concerning her personality (opinion leadership), her general usage of Facebook and the applications and sociodemographic attributes such as her age, education etc. If one answer was chosen, the respondent was confronted with a variety of questions concerning e.g. her perception of the application and how she first made contact with it. In subsequent steps, respondents were also asked whether or not and why they had installed (i.e. adopted) the application. Then they were asked whether they had exerted active influence on others to also install the application. We chose the strategy of confronting users with a predefined set of successful applications in order to focus their attention to a specific problem they faced in the past. Compared to asking general questions with regard to the adoption process without linking them to a specific question, this approach should yield more reliable answers. Nine applications were randomly selected out of the 50 most successful third party-applications (in terms of installation on Facebook as of January 28th 2008) for this purpose. We tried to address a broad variety of Facebook users with our online-survey. However, due to the strict non-spam policies of Facebook and the lack of an official cooperation with the company, it was not possible to pick a random sample of Facebook users and to ask them to fill in the survey. Therefore, we distributed invitations to the survey through various channels. Invitations were sent to the authors personal contacts on Facebook who were again asked to further forward it. Additionally, a link to our survey was posted on more than 40 Facebook user groups. Furthermore, the URL was posted in a variety of online discussion boards, blogs, college websites, forums and mailing lists in various countries and institutions. 4.2. Sample description The online-survey was accessible for 14 days. In total, we received 475 completed responses from our survey. The questionnaire was filled in by respondents of 47 different nations. The US and Germany are by far the most represented nations with 139 (29.3%) and 174 (36.6%) respondents respectively (see Table 1). Not surprisingly, college or university students account for about 75% of the respondents. The age of the respondents varies from 14 to 47; about half of the participants are in their early twenties with the average age being 23 years. The percentages of male and female participant are almost balanced; however, it is remarkable, that the female fraction of the sample is on average two years younger and much more likely to be from the US. With regard to their use of Facebook, 75% of the respondents reported to spend 5 hours or less on Facebook per week. On average, users have added slightly less than 7 applications to their profile (see Table 1). A minority 12% of the respondents indicated not having installed any third-party application at all, while nearly three quarters of the participants had installed between 1 and 10 applications. Less than 5% of the sample indicated numbers higher than 22 with 77 as the maximum. Table 1: Characteristics by gender. Share of nation in % American German Other Weekly time on Facebook in h (mean) No of installed apps (mean) Female 72.66 34.71 51.88 Male 27.34 65.29 48.13 Total 36.63 29.26 34.11 6.71 3.95 5.38 7.39 6.02 6.74 As data on the size of the basic population was not available, we are unable to report a precise response rate. However, we conducted a nonresponse analysis comparing early to late respondents [24] which yielded no indication of a non-response bias. 5. Findings As described above, the adoption of third-party applications on Facebook can occur in three different settings: A user might become aware of a specific application independently of other users on the platform and install it. Awareness and adoption might also be triggered by observing other users adoption decisions (in particular via the news-feed or by browsing other peoples profile pages). Finally, users could also be made aware of applications by recommendations they receive from other users. In the following we present results from our survey which shed some light on the relative importance of the three alternatives. Moreover, we further investigate whether there are differences in the probability that an application finally is adopted by a user depending on the way he was made aware of it. Finally, we also present evidence on characteristics and motivations of users who actively pass information on applications to their peers. 5 Proceedings of the 42nd Hawaii International Conference on System Sciences - 2009 5.1. How do users get aware of available applications? Participants in our survey were confronted with nine applications and were asked to choose one application they had heard of. They were then asked how they first took notice of the chosen application. It turns out that in the realm of Facebook, viral channels (observation of users behavior in the newsfeed or receiving recommendations) play an overwhelming role compared to self-discovery by e.g. browsing the directory of applications or noticing the application in advertisements. At an aggregated level, viral channels account for more than 90% of first contact with an application (see Table 2). Table 2: How did you first take notice of the application? Passive viral channels Active viral channels Non-viral channels I do not remember I observed that someone else was using it Someone invited me or told me about it I found out about the application by myself Total n % 22 197 5.1 45.8 197 45.8 14 3.2 430 100 In a subsequent question, participants that had not indicated that they did not remember their first contact, were asked to provide further details about the way they became aware of the application. With regard to passive channels (observation of others), the data indicates that about 30% of our respondents discovered the application on other peoples profile pages while only 10% mentioned the News Feed. Within the category of active viral channels, the most frequent response was the receipt of an invitation to join the application. Only a third of that number was prompted by the application because someone had tried to interact with them via the application. Other active communication channels seem to have played a less important role, adding up to 3% of the answers (see Table 3). Likewise, non-viral channels played almost no role, merely 4% of respondents indicated to have discovered the application via advertisement, the Facebook directory or through reports on another web page in the Internet (e.g. blogs). Taken together, it seems that viral channels are the most important source of information about new applications. Passive and active social influence are almost equally important in drawing users awareness to third-party applications. Observation of other peoples profile pages turned out to be the most important passive viral channel while invitations sent by other users constitute the most important active channel. This finding has interesting implications for firms that intend to boost the distribution of their applications by traditional online advertising channels such as linking in directories, search engine optimization or placement of text and banner ads. In social systems that provide users with inherent functionality to recommend applications to others, this word-of-mouth appears to crowd out traditional channels by capturing the majority of users attention. If this was found to hold in a variety of contexts, advertising spendings and investments need to be re-considered. Table 3: Please specify how you observed that someone else was using/ how you were told/ how you found out about the application Passive viral channels Active viral channels Non-viral channels Dont remember Profile page News Feed Request Interaction attempt Other Facebook channel Other online channel Offline channels Directory Internet Advertisement Total n 7 127 44 149 49 6 4 4 7 3 2 404 % 1.7 31.4 10.9 36.9 12.1 1.5 1.0 1.5 1.7 1.7 0.5 100 5.2. What drives adoption of applications? While respondents were first asked whether they had heard of a specific application, they were subsequently asked whether they had later added this application to their profile. In total, 199 respondents (about 42%) indicated to have done so for the application they chose in the survey. In Table 4 we report the frequency of different reasons to install an application. Interestingly, active channels of social influence account for two thirds of installations, while the observation of others in contrast plays a minor role (see Table 4). Only 26% of the respondents indicated that passive influence triggered their decision to add the application. Information that the participants found via other channels accounted for 7.6% of the installation decisions. We conclude that active recommendations by other users are the most important determinant of the 6 Proceedings of the 42nd Hawaii International Conference on System Sciences - 2009 diffusion of new applications. This is particularly interesting when compared to the results in Section 5.1. While active and passive channels are equally important in drawing users attention to applications active channels induce subsequent installations more frequently. Analogously to the above implication, this means that firms need to primarily focus on peers than on traditional advertising and even passive observation when attention shall be converted to usage. Table 4: What was the main trigger to add the application? Invited / interaction Observed Self-discovered Dont remember Total Freq. 115 52 15 15 197 % 58.38 26.40 7.61 7.61 100 Cum. 58.38 65.99 92.39 100.00 2 out 199 adopters did not answer the question 5.3. Which users actively recommend? Section 5.2 clearly demonstrated that user recommendations are particularly effective in fostering the diffusion of applications. In this section we further investigate the characteristics and motives of users who actively recommended applications. Only users who had installed an application themselves were asked about their invitation behavior. 5.3.1. Active recommendations. About 56 % of the users who installed an application actively recommended it to at least one of their friends (see Table 5). On average, recommendations were sent to about 12.6 contacts. However, the distribution is skew with a median of 4.5. Participants on average estimated the success rates of their invitations to be slightly over 60%. Table 5: Ever since you installed the application, have you tried to influence any of your friends or acquaintances to also use the application? Active influencer No act.influencer Total n 109 86 195 % 55.90 44.10 100 4 out 199 adopters did not answer the question Thus, viral growth through active channels does not seem to work via few extremely active users but rather through a broad basis of influencers the median indicates that 50% of the respondents sent not more than 4.5 recommendations. Those users issue targeted recommendations to a small number of their friends. The impact of this behavior is shown by very high reported conversion rates. 5.3.2. Motivation. Different items related to motivational aspects proposed by existing literature [9, 10, 11, 12] were included in the questionnaire and presented to those respondents who had indicated to have sent recommendations to other people. Altruistic aspects received the highest agreement rates. For example, the statement I thought other people would find the application useful or entertaining. Therefore, I told my friends about it received strongest agreement, followed by the motive to share enthusiasm (see Table 6). On the other hand, more selfish motivations that referred to increasing ones own benefit via invitations earned lesser agreement. The particular low agreement to the item related to extrinsic rewards has implications for practitioners who seek to incentivize product recommendations. While adding features that bring about local network effects and further increase the benefit from getting friends to use the could possibly increase recommendations, designing explicit reward schemes might not warrant the effort as they are not a strong motivation to pronounce recommendations. Table 6: If you told anyone about the application please indicate what your motivation to do so was I thought other people would find the application useful or entertaining. I just wanted to share enthusiasm or frustration that I experienced with the application The application is more useful to me the more of my friends use the application The application is more useful to me the more other people use the application I could earn rewards within the application for recruiting friends N Mean* p50* 105 4.17 4 100 3.21 4 99 3.10 4 100 2.39 2 100 2.01 1 *Answers on 5-point rating scale, min=1, max=5 for each item Apparently, socially desirable answering needs to be considered at this point. However, one can derive the 7 Proceedings of the 42nd Hawaii International Conference on System Sciences - 2009 implication that interface design becomes more important than promotion. Thus, firms need to employ various mechanisms (such as iterative prototyping, experimentation) to integrate users early in the product development process. 5.3.3. Communication channels. The enquiry which communication channels are used to pass on recommendations shows that the built-in recommendation functions are much more frequently used than alternative communication channels (such as other Facebook, other online or offline communication , see Table 7). Thus, designing mechanisms for easy invitations and reduced friction of recommendations seems to pay off by encouraging diffusion. Table 7: What communication channels did you use to let your friends know about the application? I used the built-in feature to invite friends I told someone offline about the application I used other Facebook communication to tell friends I told people using some sort of other online com. Total n 90 19 14 8 131 Multiple answers were allowed to this question 5.3.4. Factors impeding recommendations. When asked about their reasons not to recommend a specific application, respondents most frequently indicated that they did not feel comfortable advertising for a company or that they could not see any additional benefit for them if others joined (see Table 8). Much fewer people indicated that their friends would use the application anyway or that they were not convinced of the quality of the application. Hardly any respondents agreed that doubts about the effectiveness of a recommendation would keep them from exerting active social influence. An implication for firms which could be drawn from these results is that firms should try to build good reputation and trust with consumers. Moreover, highlighting the network benefits from having ones friends join the application might foster recommenddations. Additional features that require interaction could artificially increase network externalities and encourage recommendation behavior. Table 8: "Please indicate your reasons to NOT invite people to the application or tell them to join" I do not care who uses the application I do not want to advertise for the application Most of my friends use the application anyway I dont know enough about the application or am not convinced of the quality of it I dont think people would join if I told them so Total n 51 51 21 17 9 149 Multiple answers were allowed to this question 5.3.5. Characteristics of active recommenders. Our data suggests that users that actively send recommendations differ from users not engaging in recommendations in various ways (compare Table 9). First, differences in the perception of an innovations characteristics were observed. The perceived ease of use and triability found significantly higher agreement among the influencers than the non-influencers. Influencing behavior seems to go along with tech-savvyness, which confirms the findings from literature on opinion leadership. Likewise, risk perception varied significantly regarding the fear of clutter on ones profile page and of negative privacy implications. There was no variance in the perception that the application would be a waste of time. Interestingly, the level of perceived personal benefit did vary significantly for adopters and non-adopters but not for influencers and noninfluencers in the sample. Table 9: Perception of the innovation by influencing behavior Active influencer I expected to benefit from using the application "Using the application seemed to be pretty easy and self-explanatory" "It seemed easy to register and to try out the application" "I was afraid that my profile would appear messy if I added the application" Noninfluencer n mean n mea n pvalue 106 3.06 85 2.99 0.34 109 4.31 86 4.08 0.03 107 4.12 85 3.88 0.04 107 2.56 85 3.06 0.01 8 Proceedings of the 42nd Hawaii International Conference on System Sciences - 2009 cont. "I was afraid, that adding the application would endanger my privacy" "I was afraid that using the application might make me waste too much time" n mean n mean pvalue 107 1.88 83 2.31 0.01 107 2.24 86 2.37 0.23 One-sided p-values for significantly smaller or larger means respectively Second, influencers and non-influencers differed systematically with regard to certain socio-demographic attributes. As table 10 shows, females in the sample were much more likely to be active influencers than men. Table 10: Active influencers by gender Female Male Total Active influencer 80 27 107 No active influencer 40 46 86 Total 120 73 Pearson chi2(1) = 16.1852 ; p-value = 0.000 7. Conclusion This paper is the first to present findings on person-to-person communication and influence on Facebook. It brings forward evidence that informs research on electronic marketing in general and viral marketing in particular. User behavior does have a strong influence on awareness and adoption decisions of others. According to our data, adoption of new products (Facebook applications) is particularly driven by active peer recommendations. Firms should evaluate which recommendations channels impose minimize friction on users and ideally integrate recommendation functionality into applications and services. Extrinsic determinants do not seem to be important motivational drivers for users to recommend a service. Rather, firms should point out to users how their peers benefit from the application. Our study examines a rather novel phenomenon and exhibits some limitations that provide room for further research. One limitation concerns the static character of the analysis. As the applications at hand were already well established at the point of time when the survey was conducted, the implications for marketers might be different when they need to disseminate information about a new application. Further research is needed to enquire how the role of viral versus non-viral channels and within the first category, the role of active versus passive social influence changes over the life cycle of a product. With respect to survey design and distribution, we point out that the selection of targeted respondents was not totally random. 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Overton, Estimating nonresponse bias in mail surveys, Journal of Marketing Research, 1977, Vol. 14, pp. 396402. [25] E. Pronin, J. Berger, and S. Molouki, Alone in a Crowd of Sheep: Asymmetric Perceptions of Conformity and Their Roots in an Introspection Illusion, Journal of Personality and Social Psychology, 2007, Vol. 92(4), pp. 58595 7. Appendix These are short-descriptions of the nine applications the users could choose from in the survey. Super Wall (23 m installs / 1.6 m active users / rank 2) amplifies the ordinary Facebook Wall. Super Wall allows to also post pictures and videos and to quickly forward messages on the wall to ones friends. SuperPoke! (15.3 m installs / 460 k active users / rank 7) widens the interaction possiblities on Facebook. Users can kiss, hug or high five another and keep in touch by occasionally throwing a sheep at each other. Growing gifts (6.7 m installs / 134 k active users / rank 26) allows users to send flower pots to their friends. They can then watch a flower grow out of it in the course of some days. BumperSticker (7.2 m installs / 796 k active users / rank 19) allows the user to choose from a wide range of bumper stickers which can then be displayed on ones profile. Are YOU interested? (7.6 m installs / 533 k active users / rank 16) and HOT or NOT (4.2 m installs / 208 k active users / Rank 44) are very similar applications. Once a user has installed the application he or she can rate other users of the application according to their hotness or has to make a statement about whether or not he or she is interested in the person. Causes (9.2 m installs / 92 k active users / rank 12) lets users start and join causes they care about. The application displays the causes one has joined in the profile box, ranging from supporting presidential candidates to saving Darfur or raising awareness of breast cancer. Entourage (5.1 m installs / 154 k active users / rank 34) puts pictures of ones chosen friends onto the users profile and also provides a handy overview of the status updates of these friends. Honesty Box (4.5 m installs / 181 k active users / rank 40) displays a box on the users profile where other people can enter adjectives that describe the user anonymously. 10
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