Alexa, Buy Me a Movie!: How AI Speakers Reshape Digital Content Consumption and Preference

Technologies based on artificial intelligence (AI) have revolutionized how individuals use various services by enabling verbal command over machines. Although such alternative forms of human-machine interaction have begun to insinuate themselves into ou

Loyalty Analytics: Predicting Customer Behavior Using Reward Redemption Patterns under Mobile-App Reward Scheme

While digitalization is prevalent in loyalty programs, little remains known regarding the relationship between mobile loyalty app usage and reward redemption behavior. Using a large panel dataset consisting of 201 million transactions made by 4.9 million customers over a period of two years, we implement both the hidden Markov model and data mining approach to grasp an understanding of the relationship. The hidden Markov model is developed to capture the dynamics in latent state transitions of customers depending on the type of loyalty program used and the predictive model is used to assess the informative value embedded in customers’ reward redemption behaviors before and after mobile app adoption. Our findings lend support to the prominent value of point redemption behavior in mobile-driven loyalty schemes. Our results also indicate a volatile state transition behavior of mobile app users highlighting potential pitfalls in an absence of appropriate marketing actions

The Voice of Commerce: How Smart Speakers Reshape Digital Content Consumption and Preference

The present study investigates the effects of smart speaker usage on consumers’ digital content search, purchase, and consumption behaviors. Using a unique panel data set comprising information on household patterns of digital content (e.g., video on demand [VOD]) transactions and consumption and smart speaker usage, we found that the adoption of smart speakers is positively associated with the increased purchase of digital content but negatively related to the average rate of content completion. More specifically, we found that VOD content-related expenditures increased by 21.5% following smart speaker adoption but the average consumption of VOD content purchased decreased by 3.0%. We also examined millions of data points on TV remote-control use and conducted a survey via MTurk to support the validity of the findings. Smart speaker usage can reduce search costs, which subsequently increases search incidence and conversion rates, behavioral changes that can lead to a rise in purchases. We further show that the use of smart speakers for purposes other than information seeking is positively associated with purchases. We develop insights on how to elicit economic value from voice recognition technologies and provide implications for the design and implementation of effective voice commerce strategies

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

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

The Adoption and Use of Mobile Application-Based Reward Systems: Implications for Offline Purchase and Mobile Commerce

Customer reward systems have rapidly shifted from plastic cards schemes to mobile application-based initiatives, yet our understanding of the economic value of mobile reward systems has not kept pace with this development. Using an individual-level transaction and reward redemption dataset from a large multi-brand, offline food-and-beverage merchandiser, we examine the effects of reward app adoption on customers’ offline purchase patterns and reward redemption behaviors by using a difference-in-difference method with propensity score matching. An intriguing empirical issue is whether consumers redeem their reward points more aggressively and spend more out of pocket after adopting reward apps. Our results lend support to this argument. App engagement, which is measured by the frequency at which reward apps are activated, is positively associated with increasing cash expenditure and number of points redeemed. Furthermore, our findings imply that past reward point redemption increases the level of goodwill stock, which affects future cash expenditure

Impact of customers' digital banking adoption on hidden defection : a combined analytical–empirical approach

The implementation of digital channels as avenues for economic transactions (e.g., online and mobile banking/FinTech) has shifted the paradigm of customer–bank interactions, providing unprecedented opportunities for both parties. The prevailing belief is that digital banking has several advantages, such as lower costs and higher information transferability for customers. These benefits can also promote competition between banks given customers' predilection for “multi‐homing,” or engagement with multiple banks. This study investigated the impact of customers' digital banking adoption on hidden defection, in which customers purchase financial products from competing banks instead of their primary banks. To this end, we developed an analytical model to provide insights into the effects of digital banking adoption while taking customers' multi‐homing behaviors into consideration. We then conducted a series of empirical analyses using comprehensive individual‐level transaction data to provide evidence of hidden defection. Our findings indicate that customers with higher loyalty exhibit greater hidden defection after digital banking adoption. Customers who engage primarily with personal‐service channels (e.g., branches) show stronger hidden defection than do self‐service channel (e.g., ATMs) users, and this effect is more prevalent among loyal customers. Our results provide valuable implications for omni‐channel services in a market characterized by multi‐homing behavior of customers.Accepted versio