Seminar (Dept. of Management Science and Engineering)

Theme： Individual Sellers' Social Media Participation and Sales Activities in Social Marketplaces: A Natural Experiment

Speaker：Zhijie Lin (School of Economics and Management, Tsinghua University)

Time：2021-10-27 10:00

Address：Tencent Meeting

Language：Chinese/English

Venue: Tencent Meeting https://meeting.tencent.com/dm/NhtaSR0B3X3k 

Meeting ID：728 905 785

Password：1027

ABSTRACT：

Recent advancements in communication and social technologies have resulted in the growth of social marketplaces. Many of these marketplaces integrate social media features with peer-to-peer transactions, so that buyers and sellers may achieve trust through unstructured socialization. Despite ample evidence showing the positive effects of social media marketing and engagement on buyers' purchase intention and product usage, complementary evidence is lacking about the benefits to individual sellers from engaging via these channels. In this study, we examine the business impact of social media participation on individual seller's sales activities, exploiting a natural experiment wherein a large social marketplace for second-hand goods (Xianyu) unexpectedly removed its social media features (Fishponds). We leverage a novel dataset and employ a difference-in-differences design. Our results consistently demonstrate that sellers who initially participated in social media channel experienced a significant decline in their sales after the channel shutdown. Exploring heterogeneity in the effects around a variety of seller and product listing features, we find evidence consistent with the notion that the sellers who benefit most from social media participation are those who face the greatest difficulty establishing trust with buyers. Our work offers nontrivial managerial implications, both for marketplace operators and individual sellers.