New research shows social media posts have a positive impact on companies’ sales — Juanjuan Zhang

MIT Sloan Associate Prof. Juanjuan Zhang

MIT Sloan Associate Prof. Juanjuan Zhang

From Yahoo! Tech

It’s the Age of Social Media, and most companies are all in. They vie for likes on Facebook; they post pictures of products on Instagram; and they collect followers on Twitter and Weibo — China’s popular microblogging site — and regularly post about new services.

And yet, even as companies continue to spend time and money on social media, many are dubious about whether all that posting, tweeting, and retweeting has any effect on the bottom line.

My collaborators from Tsinghua University’s School of Economics and Management and I have just completed a large-scale field experiment on the Chinese microblogging service Weibo with a large global media company that produces documentary TV shows. We found that when the company posted about its shows, viewership rose 77 percent. Reposts by influential users, meanwhile, increased viewership by another third. The upshot: Social media platforms, like Twitter and Weibo, can have a significant impact on sales.

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Fix your resume by cutting the part about how passionate you are — Miro Kazakoff

MIT Sloan Lecturer Miro Kazakoff

MIT Sloan Lecturer Miro Kazakoff

From Bloomberg Businessweek

A young woman I know did everything right in high school, got into a good private college, and landed a position in corporate marketing for a major retail chain after she graduated. While it was a good, stable job—the kind that makes parents happy—she found it stultifying and unsatisfying.

With a solid academic pedigree and good experience, she hit the job market to look for a more fulfilling career. Several months into her search, she was floundering despite a solid job market in Boston. She wasn’t sure why.

This situation is typical of those faced by millennials I talk to. This woman’s job quest mirrors a unique phenomenon of this generation: an obsession with passion and a misunderstanding of its currency in the job market.

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Why Retailers Must (But Won’t) Succeed In Introducing Mobile Payment Systems — Catherine Tucker

MIT Sloan Professor Catherine Tucker

MIT Sloan Professor Catherine Tucker

From TechCrunch 

In the digital age, it’s critical for retailers to collect and manage customer data. This information is the key to providing personalization for any kind of shopping experience, as it allows retailers to understand customer preferences and analyze shopping histories.

Smartphone payment systems like Apple Pay are an important method of obtaining this data since they allow data collection across different retailers for the same individual. However, when the data is collected and controlled by a third party like Apple, it is risky for retailers. Read More »

How branding 101 can make leaders more mindful of diversity — Renée Richardson Gosline

MIT Sloan Prof. Renée Richardson Gosline

From The Conversation

A few years ago, I overheard two of my MBA students talking after class about their “personal brands.”

At the time, I was amused. But then I kept hearing more about this notion of “my brand.” I noticed it was the subject of articles in Forbes and Harvard Business Review. Suddenly, I saw book upon book devoted to the topic. The conversation centered around bolstering your personal brand by tweeting the right things, highlighting certain attributes in your LinkedIn profile and ingratiating yourself with other powerful personal brands.

Frankly, I bristle at the phrase “personal brand.” We are not products, we are people. The way we present ourselves should be authentic, not part of a sales pitch or advertising campaign. But then I got to thinking: is there a way to apply branding’s best practices to develop greater leadership?

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Increasing click-through rates with ad morphing — Glen Urban and John Hauser

MIT Sloan Professor Glen Urban

MIT Sloan Professor Glen Urban

MIT Sloan Professor John Hauser

MIT Sloan Professor John Hauser

From Fortune China

Everyone is trying to make their banner ads and new media more effective. In the banner area, 90% of the effort is spent on targeting. If you click on a link, you’ll get a particular ad. A whole industry has emerged focused on collecting click stream data and making recommendations.

But that is only half the picture. Equally important is the question of how you should talk to consumers once they are targeted. This is what ad morphing is all about.

For example, a car company may target a consumer whose click history indicates he is interested in buying a car. However, instead of just randomly sending him car ads, it can track the consumer’s online behavior to determine his preferred communication style. We also call this his cognitive or thinking style. Does the consumer want a picture of the car at a NASCAR race? Or would the consumer prefer to look at the technical aspects of the engine? Or does the consumer want a fashion shot of a driver pulling up to a country club? What will the consumer best respond to?

This is a multi-arm bandit problem because it’s like a slot machine with many arms. The advertiser needs to choose the ideal lever to pull to match the ad to the consumer’s thinking style. However, it’s more difficult with ads because there is uncertainty as to the consumer’s thinking style.

Our algorithm addresses this issue by monitoring click stream data to determine how a consumer makes decisions on the web. After enough information is gathered, the algorithm determines the consumer’s likely thinking styles and matches the optimal ad to our estimates of thinking styles – all in real time.

Partnering with companies like General Motors to test our algorithm, we found that morphing has tremendous potential to increase banner ads’ productivity. Companies work hard just to get a 1-2% improvement in click-throughs, but we found that morphing ads based on thinking styles can improve that rate up to 83%. We also found that morphing can lead to 30% better brand recognition. These are very significant effects.

While our algorithms (see our paper for the algorithms) can be implemented by any good programmer skilled in the art, morphing can challenge the budget. To use this tool, companies have to design more ads – ads that appeal to each of the various thinking styles of customers. There also may be cross-organizational issues, as the people who create those ads must coordinate with the analysts doing the targeting.

However, this is the only algorithm that we’re aware of that integrates thinking styles and morphing in real time. It’s very cutting edge, but it can help move the market to the next wave of action in banner advertising.

Also see the post in Chinese at Fortune China.

Glen Urban is the David Austin Professor in Management, Emeritus, Professor of Marketing, Emeritus, Dean Emeritus, and Chair of the MIT Center for Digital Business at the MIT Sloan School of Management. 

John Hauser is the Kirin Professor of Marketing and a Professor of Marketing at the MIT Sloan School of Management.