E-loyalty networks in online auctions

Creating a loyal customer base is one of the most important, and at the same time, most difficult tasks a company faces. Creating loyalty online (e-loyalty) is especially difficult since customers can ``switch'' to a competitor with the click of a mouse. In this paper we investigate e-loyalty in online auctions. Using a unique data set of over 30,000 auctions from one of the main consumer-to-consumer online auction houses, we propose a novel measure of e-loyalty via the associated network of transactions between bidders and sellers. Using a bipartite network of bidder and seller nodes, two nodes are linked when a bidder purchases from a seller and the number of repeat-purchases determines the strength of that link. We employ ideas from functional principal component analysis to derive, from this network, the loyalty distribution which measures the perceived loyalty of every individual seller, and associated loyalty scores which summarize this distribution in a parsimonious way. We then investigate the effect of loyalty on the outcome of an auction. In doing so, we are confronted with several statistical challenges in that standard statistical models lead to a misrepresentation of the data and a violation of the model assumptions. The reason is that loyalty networks result in an extreme clustering of the data, with few high-volume sellers accounting for most of the individual transactions. We investigate several remedies to the clustering problem and conclude that loyalty networks consist of very distinct segments that can best be understood individually.Comment: Published in at http://dx.doi.org/10.1214/09-AOAS310 the Annals of Applied Statistics (http://www.imstat.org/aoas/) by the Institute of Mathematical Statistics (http://www.imstat.org

The insider on the outside: a novel system for the detection of information leakers in social networks

Confidential information is all too easily leaked by naive users posting comments. In this paper we introduce DUIL, a system for Detecting Unintentional Information Leakers. The value of DUIL is in its ability to detect those responsible for information leakage that occurs through comments posted on news articles in a public environment, when those articles have withheld material non-public information. DUIL is comprised of several artefacts, each designed to analyse a different aspect of this challenge: the information, the user(s) who posted the information, and the user(s) who may be involved in the dissemination of information. We present a design science analysis of DUIL as an information system artefact comprised of social, information, and technology artefacts. We demonstrate the performance of DUIL on real data crawled from several Facebook news pages spanning two years of news articles