Consumer Response to Social Media and Online Video Advertising

This paper investigates the effectiveness of social media advertising and online video advertising using three large-scale controlled field experiments in the U.S., China and the Netherlands. The study was implemented using a technological approach that allows researchers to combine controls with real-world validity. The studies are based on an adaptive-experimentation method that allows across-sample and within-sample adaptation. This method facilitates incremental exploration of complex phenomena with cycles of discovery and validation across multiple studies. For the real-world stimuli in the automobile industry, the results show that advertising effectiveness of online videos is consistently stronger than social media and that the relative strength of social media increases the further temporally a consumer is from purchasing. We also find that attention strengthens consumer response to online video and social media advertising, but when both are viewed simultaneously at high levels of attention, they become substitutes.

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