Abstract
Many companies compete globally in a world in which user ratings and price are important drivers of performance but whose importance may differ by country. This study builds on the cultural, economic, and structural differences across countries to examine how app popularity reacts to price and ratings, controlling for product characteristics. Estimated across 60 countries, a dynamic panel model with product-specific effects reveals that price sensitivity is higher in countries with higher masculinity and uncertainty avoidance. Ratings valence sensitivity is higher in countries with higher individualism and uncertainty avoidance, while ratings volume sensitivity is higher in countries with higher power distance and uncertainty avoidance and those that are richer and have more income equality. For managers, the authors visualize country groups and calculate how much price should decrease to compensate for a negative review or lack of reviews. For researchers, they highlight the moderators of the volume and valence effects of online ratings, which are becoming ubiquitous in this connected world.
| Original language | English |
|---|---|
| Pages (from-to) | 20-44 |
| Number of pages | 25 |
| Journal | Journal of Marketing |
| Volume | 82 |
| Issue number | 5 |
| DOIs | |
| Publication status | Published - Sept 2018 |
| Externally published | Yes |
Funding
Raoul Kübler is Assistant Professor of Marketing, Özyeg˘in University and Marketing Center Münster, University of Münster (email: raoul.kuebler@ uni-muenster.de). Koen Pauwels is Professor of Marketing, BI Norwegian Business School and Northeastern University (email: kpauwels@ northeastern.edu). Gökhan Yildirim is Assistant Professor of Marketing, Imperial College London (email: [email protected]). Thomas Fandrich is Chief Operating Officer, quantilope GmbH (email: thomas. [email protected]). The authors thank the JM review team and the audience at the Wharton Marketing Science Conference on Emerging Markets, the Theory and Practice in Marketing Conference, the EMAC and Marketing Science conference, and Marketing Science Institute for their helpful feedback. The third author acknowledges the National Research Project ECO2015-67763-R grant by the Spanish government. Venkatesh Shankar served as area editor for this article.
Keywords
- Dynamic panel model
- Hofstede's cultural factors
- Mobile apps
- Price sensitivity
- Rating sensitivity