ecommerce

Human-Plus: A Future of Advertising to Algorithms

  • AI Series

On January 16, we kicked off our AI Series while exploring what AI means for consumers, advertisers, and the rapidly evolving marketplace. Attendees gained access to new research, perspectives, and practical guidance for staying ahead. Panelists dove into actionable strategies for the future of shopping and unveiled Kantar’s groundbreaking “Human-Plus” framework — a human-centric perspective on AI that anticipates consumer needs, marketing opportunities and investment strategies.

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How Accessible is Social Media to the Disabled?

  • JOURNAL OF ADVERTISING RESEARCH

Social media has transformed how people communicate, access information and shop. Despite its widespread use, digital content remains inaccessible for blind and/or deaf consumers due to missing or inaccurate accessibility features like alt text and closed captioning. This study examines the utilization and accuracy of these features on social media platforms and highlights the challenges vulnerable consumers face.

The findings reveal that many social media posts lack proper accessibility features, resulting in lost opportunities for consumers and organizations. The study emphasizes the need for proactive interventions and changes in public policy to enhance digital accessibility for all users.

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Using AI Assistants to Predict Purchase Intent

  • MSI

This study examines user interactions with AI assistants to infer purchase intent. By analyzing the text of user-initiated interactions, researchers build a bipartite network of nouns and verbs and measure the distance of specific words to "golden" purchasing words like "purchase," "buy" or "order." The study uses large language models, specifically Chat-GPT4, to annotate data with a measure of purchase intent and validates this method by comparing the results with cost-per-click (CPC) for keywords in Google Ads. The findings suggest that words used in an exchange with an AI assistant can predict purchase intent without customer tracking across interactions.

These findings have implications for using customized small versus large language models and can potentially inform advertising decisions. The study highlights the importance of understanding consumer behaviors in interactions with AI assistants. It provides a method to predict purchase intent based solely on the textual content of these interactions.

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Variety Plays an Important Role in Forming New Consumption Routines

  • MSI

Learn the role of product variety in forming new consumption routines with this recent MSI working paper. Researchers Sarah Memmi and Jordan Etkin conducted a six-week field study focusing on flossing habits. They found that using a variety of dental flosses, as opposed to a single type, can help consumers engage more consistently in the new routine. This research suggests that variety not only makes the routine more enjoyable but also aids in preference development.

The findings challenge the traditional view that uniformity is key to habit formation. Instead, incorporating variety can be a simple and effective strategy for both consumers and marketers to enhance engagement and loyalty. This research provides actionable insights for creating and maintaining consumption routines, particularly in health-related behaviors.

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The Unintended Consequences of Behavior-Based Pricing under Informed Privacy Consent

  • MSI

Explore the implications of informed privacy consent on behavior-based pricing (BBP) with this new MSI working paper. It highlights how privacy regulations requiring consumer consent before data collection impact pricing strategies and consumer surplus. The research finds that while informed consent empowers consumers, it paradoxically reduces overall consumer surplus by reducing the potential benefits of customized offers.

The study also reveals that firms can achieve higher profits by offering rewards for privacy consent, despite the associated costs. This underscores the complexity of privacy regulations and their unintended consequences on market dynamics and consumer welfare.

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Virtual Influencers, Advertising’s Financial Impact, and Avatars in the Metaverse

  • JAR INSIGHTS STUDIOS

At this Insights Studio, researchers from top institutions presented pioneering work addressing the evolving landscape of advertising. Topics of discussion included: an exploration of virtual influencers and the effectiveness of virtual influencers in real-world versus virtual-world settings, a comprehensive synthesis of over 250 studies examining the complex relationship between advertising and a company’s stock price, and a deep dive into the emerging world of the metaverse with a study on how the presence of employee avatars in virtual stores influences consumer behavior.

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Are Virtual Influencers More Effective in Real-World Settings?

  • Journal of Advertising Research

Virtual influencers are computer-generated personas that engage with audiences on social media and in the metaverse. This study explores whether virtual influencers are more effective in advertising when they include real-world elements, such as interacting with real humans or endorsing real-world products. The research is grounded in the Computers Are Social Actors (CASA) framework and investigates how social cues and product types influence consumer perceptions of authenticity and attitudes toward both the influencer and the brand.

The findings suggest that virtual influencers are perceived as more authentic and favorable when they are shown alongside real humans and endorse real-world products. This perceived authenticity positively impacts consumer attitudes toward the virtual influencer and the brand, providing valuable insights for advertisers looking to leverage virtual influencers in their marketing strategies.

More analysis and the full study is available to ARF members.

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