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Viralty and Advertising Effectiveness in the World-Wide Web

http://www.netinst.org/Tucker_11_06.pdf

 

In class, we learned about information network effects and its implications in the World-Wide Web. In her paper titled “Viralty, Network Effects and Advertising Effectiveness”, Catherine Tucker models the World-Wide Web as a information network and makes conclusions about the effectiveness of advertisements on consumers by companies on the World-Wide Web. Through her study, Tucker concludes that the virality of an ad is often not directly correlated with its effectiveness in convincing consumers to purchase their product; “We find evidence that there is significant trade-off between  virality and ad effectiveness.” This is to say that often, the most popular of ads fail to garner the company that deployed this ad the attention the company desired. In fact, the most popular of ads Tucker argues are the ones that are least effective at persuading consumers to purchase the product. For every 1 million views, Tucker suggests that there is roughly a 10% decline in effectiveness. However, this decline in effectiveness is somewhat inherently accounted for by potentially being able to convince more people and thus increasing the “reach” of the advertisement. Ultimately, the cut-off point for negative consequences seems to be after an ad reaches over 3 million views. The intuition Tucker argues is that the majority of these ads appear to be too outrageous or provocative to consumers and are shared simply for this nature. Thus, Tucker concludes that provocative ad design is sufficient in inducing consumers to share an ad, but is insufficient in inducing them to be influenced by the ad.

 

Tucker further makes the analysis that videos that receive many comments with respect to the number of views do not suffer from the aforementioned negative consequences. The ads Tucker targets are those labeled as “funny and visually appealing”. These ads tend to elicit a high ratio of views to comments. By comparison, the provocative and outrageous advertisements tend to have extremely low ratios of views to comments. The “funny and visually” appealing advertisements are also able to successfully gather a large number of views in comparison to the advertisements that fall in neither of the two aforementioned categories, however, in comparison to the number of views garnered by provocative ads, the “funny and visually appealing” ads seem to lack significantly in number of views. Thus, there seems to be a tradeoff between gathering views and getting positive feedback; it is not necessarily the best to garner a positive feedback for your advertisement as making your advertisement provocative can increases the number of views you get and thus the chance of garnering consumers.

 

In conclusion, as we have seen, the virality of an advertisement does not necessarily correlate with the effectiveness of an advertisement. In fact, the most viral advertisements are often the most provocative or outrageous in design and thus the least effective.

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