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Lite app adoption and cannibalisation
Journal of Digital & Social Media Marketing,
9
(3),
261-274
(2021)
Abstract
Over the past few years, firms have increasingly adopted mobile applications (ie apps) to reach and serve their customers. More recently, the trend for simplified versions of these apps (ie lite apps) has been growing. To date, little is known about how the adoption of lite apps affects customer usage across different online channels. To address this gap in the literature, this study conducts empirical analysis to examine whether the adoption of a new lite app increases or cannibalises customer spending/transactions on a company’s existing app and across all channels. Econometric analysis is performed using a unique dataset obtained from an online platform where merchants offer daily deals to their customers. The market shock induced by the platform’s introduction of a lite app provides an opportunity to examine customers’ adoption and usage of a lite app. The difference-in-differences models coupled with dynamic propensity score matching reveal that the lite app channel cannibalises the original app channel. Moreover, the lite app adoption does not improve existing customers’ total contribution across all online channels. These findings provide important implications for firms to manage mobile apps effectively.
Keywords: app; adoption; cannibalisation; channel interdependency
The full article is available to subscribers to the journal.
Author's Biography
Tianfu Wang is an assistant professor of marketing at Montclair State University. He focuses on how marketers can use Big Data analytics and artificial intelligence in conjunction with experiments to optimise business decisions. He adopts a data-driven approach to identify and quantify the impact of marketing activities and the moderating factors in the context of computational advertising, mobile marketing and social media.
Yam B. Limbu is a professor of marketing at Montclair State University. His research interests include consumer behaviour, internet marketing and healthcare marketing. He is an associate editor for the Journal of Research in Interactive Marketing, and Editor-in-Chief for the International Journal of Business and Emerging Markets and the International Journal of Business and Applied Sciences. Dr Limbu is vicepresident of the Academy of Global Business Research & Practice.
Junzhou Zhang is an assistant professor of marketing at Montclair State University. His research focuses on loyalty programmes, digital marketing and healthcare marketing. His research highlights the intersection among marketing, technology and consumer psychology. His expertise lies in integrating consumer psychology theory with consumer Big Data to bring forward useful customer insights and actionable marketing strategies.
