Revenue models, in-app purchase, and the app performance: Evidence from Apple's App Store and Google Play

The effect of revenue models on app performance depends on the app store.The effect of in-app purchase on app performance depends on the app store.Paid, freemium and in-purchase models are shown to be effective in app store.Freemium and in-app purchase models are shown to be less effective in Google Play.App category influences the effects of both revenue models and in-app purchase. In this paper, we empirically examine how the revenue model (paid, free, or freemium) adopted for a given app affects the app revenue performance as measured by the app daily revenue rank. We also study the impact of in-app purchase on this measure of performance. Moreover, we study how such relationships are co…

Environmental Sustainability Orientation, Reward-Based Crowdfunding, and Venture Capital: The Mediating Role of Crowdfunding Performance for New Technology Ventures

Extant literature has investigated the effects of new ventures’ environmental sustainability orientation (ESO) on the crowdfunding (CF) performance and on the ability to secure venture capital, separately and with mixed results. In this article, we address the study of these relationships simultaneously. Specifically, we examine how the presence of ESO features influences new technology-based ventures’ ability to secure funding in reward-based CF campaigns and how the CF performance mediates the effect of such features on attracting subsequent venture capital. Using a sample of new hardware ventures that have launched a CF campaign on Kickstarter, we document a negative effect of the presen…

Crowdfunding performance, market performance, and the moderating roles of product innovativeness and experts' judgment: Evidence from the movie industry

Reward-based crowdfunding (CF) has emerged as a method to solicit funds for innovative projects. Yet, little is still known about the ability of reward-based CF to act as a signal in the eyes of future consumers, and thus boost the future market performance of new products that innovators intend to commercialize using the campaign funds. In addition, scant research has clarified the boundary conditions that can magnify or weaken the efficacy of this CF signal. Given the relevance of reward-based CF for supporting innovation, understanding when the CF campaign performance works as an effective signal is of great interest, especially in business settings characterized by high product quality …

An alliance timing game under real options in biopharmaceutical industry

A real options game of alliance timing decisions in biopharmaceutical research and development

Abstract In this article we examine the alliance timing trade-off facing both pharmaceutical and biotech firms in a stochastic and competitive environment. Specifically, we introduce a real options game (ROG), where a pharmaceutical company can choose between two competing biotech firms by sequentially offering a licensing deal early or late in the new drug development process. We find that, when the alliance raises the drug market value significantly, the agreement is signed late in the drug development process. This suggests that the postponement effect implied by the use of real options prevails over the biotech firms’ competition effect, which would instead play in favor of an early agr…

Factors influencing success in the Italian app markets: an empirical analysis

Understanding the purchasing behavior of consumers in response to sustainable marketing practices: An empirical analysis in the food domain

Sustainability has become an important driver in defining business strategies, affecting most critical corporate functions and changing the way in which value is created, communicated, and distributed. This is increasingly impacting marketing practices, in particular, through promoting the development of sustainable marketing in the food sector. In line with this, our study aimed to investigate if and how sustainable marketing practices affect consumer loyalty to a specific brand. To answer our research questions, we relied on the results of a survey submitted to a sample of 907 Italian consumers of biscuits. Results showed that the consumers’ attention to sustainable issues (in the absence…

The developers' perspective in Mobile App Markets: an empirical analysis of price drivers

Understanding the Drivers of the Daily App Rank: The Role of Revenue Models

In this paper, based on data from two major app stores (Apple Store and Google Play), we study the role of several revenue models adopted by developers in the success of an app measured in terms of daily rank.

Understanding the price drivers of successful apps in the mobile app market

In this paper, we take the perspective of app developers. Specifically, based on a sample of top paid apps from three major app stores, i.e., App Store, Google Play, and Blackberry World, we construct a hedonic price model to examine the role of relevant factors in price formation in the app market. Our results suggest a strong evidence of two-sided market effects. In fact, the lower price charged for apps operating as two-sided markets reflect the strategy of subsidising users, due to the positive cross-side externalities they exert on valuable third parties. Surprisingly, the effects of trialability, in-app purchase and mechanisms to build reputation are not significant in the context of …

Diversification and performance in the mobile app market: The role of the platform ecosystem

Abstract We examine the effect of app developers' product line diversification decision on their performance and shed light on whether the type of platform ecosystem (open versus closed) where they commercialize apps influences this effect. We compare the revenue performance of diversified and specialized developers in Apple's App Store and Google Play. We show that in the Apple's App Store (closed platform) diversified developers always display lower performance than their specialized counterparts. In Google Play (open platform) diversification is beneficial in categories where diversified developers have predominant market share, whereas it is detrimental in categories dominated by specia…

Cooperation and competition strategies in advertising

Models of group-buying in competitive markets

Price dispersion and competition in business routes: An empirical analysis

Does diversification pay in the app market? Evidence from Apple's App Store and Google Play

In this paper we address the study of the effects of product line diversification on firm performance in the mobile application market. Specifically, we shed light on whether the distribution platform ecosystem where developers commercialize their apps influence the effect of product line diversification, i.e., diversification across different app categories, on developer sales performance. To these purposes, we compare the sales performance of diversified developers with that of category-specialized developers in the two major app stores (namely, Apple’s App Store and Google Play). Our results show that the diversification strategy has a positive impact on developer sales in Google Play, w…

Biopharmaceutical alliances and competition: a real options game approach

The role of product-based crowdfunding in attracting traditional startup funding

How does brand-related user-generated content differ across social media? Evidence reloaded

Abstract In light of the relevant changes in the social media environment in recent years, this paper extends the theoretical framework of user-generated content (UGC) dimensions and updates evidence on how brand-related UGC characteristics vary across social media. Using content analysis and statistical analysis of frequencies, we compare how different social media (Facebook, Twitter, and YouTube) shape twelve important UGC dimensions. Our findings suggest that, by flattening the differences on visual and richer content, the recent trends have made Facebook and Twitter more similar to YouTube on certain brand-related UGC dimensions (e.g., self-presentation, brand centrality, brand recommen…

From the crowd to the market: The role of reward-based crowdfunding performance in attracting professional investors

Abstract We focus on new technology-based entrepreneurial ventures engaging in reward-based crowdfunding and examine the effect of their performance in such funding channel on the likelihood of securing subsequent funding from professional investors. We also study how this effect is influenced by the presence of patents granted for the new product idea and the entrepreneur social capital. Results from a sample of technology projects launched on Kickstarter demonstrate that pledging a higher amount of money in crowdfunding can ignite professional investors’ interest and thus help secure subsequent funding. However, this positive evidence is effective only when complemented by the presence of…

Generic Advertising, Brand Advertising and Price Competition: An Analysis of Free-Riding Effects and Coordination Mechanisms

The main purpose of generic advertising is to enlarge the total market demand rather than capturing further slices from competitors. Several studies point out emergence of free-riding behavior under independent contribution and suggest use of coordination mechanism. However, existing literature does not shed light on the conditions under which generic advertising can be detrimental (beneficial) to stronger firms weakening (strengthening) their competitive advantage. Also, under a setting including both price and brand advertising competition, coordination in generic advertising has not been unraveled. In order to deal with such issues, we consider a one-stage duopoly game in which two firms…

Group Buying of Competing Retailers

Under group buying, quantity discounts are offered based on the buyers' aggregated purchasing quantity, instead of individual quantities. As the price decreases with the total quantity, buyers receive lower prices than they otherwise would be able to obtain individually. Previous studies on group buying focus on the benefit buyers receive in reduced acquisition costs or enhanced bargaining power. In this paper, we show that buyers can instead get hurt from such cooperation. Specifically, we consider a two-level distribution channel with a single manufacturer and two retailers who compete for end customers. We show that, under linear demand curves, group buying is always preferable for symme…

Designing multi-attribute auctions for engineering services procurement in new product development in the automotive context

Abstract In recent years, use of multi-attribute auctions has been consolidating as a powerful mechanism in procurement settings where multiple drivers affect the transaction outcome. This paper provides a project management approach for multi-attribute auction design for standardized engineering services procurement in the context of new product development in automotive industry. Two variables are taken into account in the bidding process: price and duration of the given engineering activity. From a theoretical viewpoint, we fully determine optimal suppliers’ bidding strategies and expected outcomes, i.e. score/utility, price and duration, for the buyer under both first score sealed bid a…

An empirical analysis of online price dispersion in the Italian airline industry

Firms operating in the electronic marketplace set and adjust prices to affect demand and profitability. In service markets, such as airline markets, different prices are commonly offered by diverse firms to accommodate to a variety of market segments having particular sets of consumer attitudes. This variation in prices is the price dispersion and is based on market distinctiveness deriving from customer heterogeneity as well as the peculiar competition in the specific market arena. In this paper we use a panel dataset from the Italian airline market to investigate the role of competition and different online channels in the emergence of price dispersion. Specifically, we examine the unclea…

A Theoretical Framework For Collaborative Engineering In New Product Development In The Automobile Industry

From Emotional (Dys)Regulation to Internet Addiction: A Mediation Model of Problematic Social Media Use among Italian Young Adults

Internet addiction (IA) has mostly been investigated with the fear of missing out and difficulties in emotional regulation. The present study examined the link between IA and variables related to problematic social media use (i.e., fear of missing out, social media addiction), together with emotional (dys)regulation and personality traits, providing new insights and an integrated assessment of IA. In total, 397 participants, aged 18–35 years (M = 22.00; SD = 3.83), were administered a set of questionnaires pertaining to IA, problematic social media use, emotional (dys)regulation, and personality traits. Pearson’s correlations showed significant associations between IA and the investigated v…

Price dispersion in the Italian airline industry: the role of competition and online travel agents

Shaping collaboration in new product development through negotiation and auctions

Opaque Distribution Channels for Competing Service Providers: Posted Price vs. Name-Your-Own-Price Mechanisms

Opaque selling has been widely adopted by service providers in the travel industry to sell off leftover capacity under stochastic demand. We consider a two-stage model to study the impact of different selling mechanisms, posted price (PP) versus name-your-own-price (NYOP), of an opaque reseller on competing service providers who face forward-looking customers. We find that in this environment, providers prefer that the opaque reseller uses a posted price instead of a bidding model. This is because the ability to set retail prices is critical for extracting surplus from customers who wait to purchase from the reseller. Such surplus extraction enables providers to set high prices for advance…

Crowdfunding as a tool to support sustainability‐oriented initiatives: Preliminary insights into the role of product/service attributes

A common goal of current research seems to uncover whether crowdfunding (CF) could be considered an effective way to support sustainability-oriented initiatives in securing funding, due to diverging results emerging from literature. We claim that the objective of proving whether CF may benefit sustainability-oriented initiatives could be misplaced; rather, we deem more fruitful to understand how critical are some attributes of products/services pursued within CF campaigns to benefiting sustainability-oriented initiatives and increasing their odds of success in CF. We focus on food-related projects as in this sector, sustainability issues apply more than to any other human activities and con…

Group Buying of Competing Retailers

Development of a Decision Support System Framework for Cultural Heritage Management

Decision support systems (DSSs) have been traditionally identified as useful information technology tools in a variety of fields, including the context of cultural heritage. However, to the best of our knowledge, no prior study has developed a DSS framework that incorporates all the main decision areas simultaneously in the context of cultural heritage. We fill this gap by focusing on design-science research and specifically by developing a DSS framework whose features support all the main decision areas for the sustainable management of cultural assets in a comprehensive manner. The main decision-making areas considered in our study encompass demand management, segmentation and communicati…

Sharing economy and dynamic pricing: Is the impact of Airbnb on the hotel industry time-dependent?

Abstract Prior literature has reported significant price and revenue reductions in the hotel industry due to the emergence of Airbnb. Other studies have documented that hotels' price reactions to the penetration of Airbnb depend on their service level, e.g., low/medium-end versus high end. Relying on a large sample from the Italian market, we contribute by showing that the effect of Airbnb on hotels' price decisions does not only depend on incumbents’ quality level, but also on the difference between booking and check-in time. That is, the effect of the penetration of Airbnb on hotels' dynamic price decisions varies over time depending on the core segment hotels target.

Gender differences in internet addiction: A study on variables related to its possible development

Internet addiction and its related variables (i.e., internet gaming addiction, social media addiction, fear of missing out, phubbing) have mostly been investigated in the general population without considering possible gender differences. The present study aimed to investigate the specific characteristics of men and women in the possible development of pathological behaviors related to internet addiction. A total of 276 participants (of ages ranging from 18 to 30 years old) were recruited in the study (46.7% were males) and responded to online questionnaires on variables related to internet addiction and psychological traits. The results showed that gender represents a key factor in explain…

Reward-based crowdfunding campaigns: Informational value and access to venture capital

We consider an entrepreneur who designs a reward-based crowdfunding campaign when the campaign provides a signal about the future demand for the product and subsequent venture capital is needed. We find that both the informativeness of the campaign and considerations related to gaining access to venture capital funding affect the entrepreneur’s choice of campaign instruments, as well as her decision of whether to run a campaign. In particular, entrepreneurs should launch the campaign either when it is highly informative or when it is not informative at all. For relatively low levels of informativeness, but not so low that the venture capitalist (VC) completely ignores the campaign outcome …

Factors influencing prices in the mobile apps’ store distribution model: An empirical study

What to show on the wine labels: a hedonic analysis of price drivers of Sicilian wines

Unlike previous literature, we construct a hedonic model of wine price that incorporates all the main categories of variables simultaneously to enable a better evaluation of their importance on wine price formation. A comprehensive model has the advantage of providing more reliable estimates of the attributes' implicit prices thereby facilitating firms' pricing and improving effectiveness of wine production and marketing decisions. We utilize two different datasets of Sicilian wines collecting data from influential wine guides. Our results suggest that wine price strongly depends on objective features such as vintage, alcoholic content, geographical origin, grape variety, producer size and …

Cooperation among competitors: A comparison of cost-sharing mechanisms

Abstract In this paper, we investigate the consequences of using outcome-based versus ex ante-based cost-sharing mechanisms in terms of competing firms' profitability and total welfare. We consider two firms making a joint expenditure, which can positively affect firms' demand and/or unit operating costs, while competing in the final market by setting either price or quantity. We compare two outcome-based cost-sharing mechanisms, i.e., Quantity Proportional (QP) and Total Margin proportional (TM), with the more competitive Fixed Share (FS) mechanism where cost-sharing is set up on an ex ante basis. We show that outcome-based mechanisms, and even a fully collusive behavior induced by the opt…

On the signaling effect of reward-based crowdfunding: (When) do later stage venture capitalists rely more on the crowd than their peers?

Abstract Venture capitalists (VCs) make only a small number of investments and are more likely to invest in ventures where other VCs have invested previously. As such, valuable opportunities may be forgone if they are not funded by VCs in the first place. We demonstrate how crowdfunding (CF) can remedy this concern. Using a sample of new technology-based ventures, we reveal that ventures initially funded through reward-based CF can be even more likely than those initially backed by VCs in attracting follow-up funds from VCs. This happens when ventures originally funded via reward-based CF complement the certification they derive from CF with patents and a founding team with a track record o…

Price dispersion, competition, and the role of online travel agents: Evidence from business routes in the Italian airline market

Abstract In this article, using data from the Italian airline market, we study the role of online travel agents (OTAs) in driving price dispersion as compared to the effect of airlines’ websites. Specifically, we investigate how distinctive factors between OTAs and airlines’ direct channels influence price dispersion. We find that after controlling for OTAs’ features related to airline competition, price dispersion should be lower in the OTA channel relative to airlines’ direct channels. On the other hand, we also find that OTAs’ features related to the presence of airline competition play in favor of higher price dispersion in such indirect channel.

BIOPHARMACEUTICAL ALLIANCES AND COMPETITION: A REAL OPTIONS GAMES APPROACH

The competitive landscape where pharmaceutical and biotechnology companies operate has changed radically due to a scientific/technological progress that has revolutionised the process by which drugs are developed. In fact, pharmaceutical industry more and more relies on advances in biochemistry and molecular biology. As a consequence, the number of partnerships between pharmaceutical and biotech firms has grown significantly. Research contributions addressing the biopharmaceutical alliances design have also focused on the optimal timing to sign a partnership. In this paper, we introduce and analyse the effect of competition in biotechnology industry by modelling the decisions of whether and…

Understanding the crowdfunding phenomenon and its implications for sustainability

Abstract Nonetheless the large body of knowledge rapidly accumulated on crowdfunding as well as the growing relevance of this phenomenon for sustainability, there are very few studies on the role of crowdfunding for sustainability-oriented projects, and many related issues are still far from being fully understood. This signalises a clear need for unveiling the main dynamics of the relationship between crowdfunding and sustainability, and also opening up useful directions for future research on this relationship. To conceptualize the implications of crowdfunding for sustainability, we propose and use a framework, encompassing five dimensions, namely the project creator, the backers, the cam…

The role of the distribution platform in price formation of paid apps

In this paper we study the role of the distribution platform as an important determinant of price of paid apps. We also examine how the distribution platform influences the price implications of important developers' app-level decisions. To these purposes, we construct a hierarchical model of price formation by using an ad-hoc panel dataset consisting of top paid apps from the two major app stores, namely Apple's App Store and Google Play. Our findings show that prices of paid apps strongly depend on the platform where the apps are marketed. Specifically, the App Store is associated with lower prices for paid apps than Google Play. We find evidence that this is because the impact of cross-s…

An empirical analysis of revenue drivers in the mobile app market

Sharing economy and incumbents' pricing strategy: The impact of Airbnb on the hospitality industry

Abstract In this paper, we examine how the emergence of sharing economy platforms influences incumbents' price responses. Grounding on the literature on price reactions to new entrants and on the unique characteristics of the sharing economy, we argue that the effect of the penetration of the sharing economy on incumbents' prices is not straightforward, and actually depends on the type of incumbents as well as certain product/service offer characteristics. Indeed, relying on a large sample of hotel price offerings from the Italian market, we find that the effect of the growing relevance of the sharing economy (exemplified by Airbnb) on incumbents' prices depends on the type of incumbents (l…

Sharing Economy: A Business Perspective

The developments in information technology on the one hand, and the reduced purchasing power of many people due to the global crisis as well as the increasing sustainability concerns on the other hand, have contributed in recent years to the creation of a multitude of Internet-enabled peer-to-peer platforms and the consequent rise of a new paradigm of economy, namely the sharing economy. Under this paradigm, consumers on a massive scale share and make use of underutilized resources upon payment. In this chapter, we present an overview of the sharing economy phenomenon from a business perspective by identifying the major factors guiding its emergence and growth, by presenting some important …

Collaboration Engineering Framework to Support New Product Development in the Automobile Industry