Research

Suhag R, Rajdeep Grewal, Frank German (2023) Diversity, Equity, and Inclusion, Sociopolitical Activism, and Economic Consequences: The Tucker Carlson Effect – Invited for 2^nd round review at Journal of Marketing

Tucker Carlson gained popularity for his ideology and controversial statements that represent sociopolitical activism concerning Diversity, Equity, and Inclusion (DEI). Two of these statements prompted activist groups to call for brands to stop advertising during his Fox News show. To gauge the economic consequences of Carlson’s public stances on two prominent DEI-related sociopolitical issues—immigration (2018) and Black Lives Matter (2020)—we gather multisource data from Kantar Media and Nielsen TV, then apply a Bayesian synthetic difference-in-differences method to estimate impacts on his show’s advertising revenue and the supply-side drivers of that revenue. The results indicate that Carlson’s show lost advertising revenue in 2018 but not in 2020. According to mechanism analyses, following the 2018 event, the number of advertisements on Carlson’s show declined, along with the cost of advertising; remaining advertisers gained longer advertising windows during the show, but the longer windows did not mitigate the overall economic effect. A supplementary analysis shows that advertisers became more homogenous and politically aligned with Carlson’s ideology after the 2018 event, likely buffering advertising losses in 2020. That is, the cost of advertising decreased following the 2020 event, but revenues did not, because advertisers did not stop buying airtime. These findings highlight the need for advertising channels and brands to be more diligent in their selection of strategic media partners.

Suhag R, Rajdeep Grewal (2023) Rebranding and the Behaviors of Content Creators: A Study of Twitch Prime Becoming Prime Gaming

Rebranding in the digital realm helps providers enhance their brand identities, streamline services, and optimize user experiences. However, its impacts on user behavior, particularly on two-sided platforms, remains unexplored. Accordingly, the current study uses the rebranding of Twitch Prime to Prime Gaming, and related data reflecting live streamers’ behavior (i.e., airtime – the total time a streamer broadcasts in a month), and viewership (i.e., number of viewers and the total hours of content consumed in a month) to estimate average and individual treatment effects (ITEs) of rebranding (on airtime and viewership). The results reveal a negative influence of rebranding on streamer airtime but a positive impact on viewership. Substantial heterogeneity arises in streamers’ reactions; based on a projection of ITE scores on pre-rebranding channel viewership, chat volume between streamer and viewers, and revenue from subscription and tips. Results show that streamers with greater pre-rebranding viewership, chat volume, and revenue (subscription and tips) decrease airtime, whereas others increase airtime in a bid to attract more viewers. These findings help debunk the conventional belief that greater airtime implies higher viewership. By detailing the critical interplay among platform rebranding, streamer behavior, and associated changes in viewership, this study sheds light on the unintended consequences of rebranding, such as decrease in airtime. Managers can apply findings to encourage specific streamers to maintain the pre-rebranding level of content (airtime for livestreaming) on the platform and thereby maximize viewership.

Suhag R, Rajdeep Grewal (2023) Monetary and Non-Monetary Promotions for Entrepreneurial Buyers

Promotions play an important role in the decision making of both consumers and businesses, including entrepreneurial firms. Selling firms, despite having numerous promotional options at their disposal, often struggle to identify which strategy will work best for diverse buying firms. To establish the unique influences of different monetary and nonmonetary promotions on entrepreneurs’ buying decisions, this study gathers data from an industrial equipment and tools retailer that conducted field experiments to estimate the sales impacts of its promotions. With a Bayesian doubly robust heterogeneous treatment effect (HTE) model, estimated using a Bayesian Additive Regression Trees (BART)-based causal inference model, the Bayesian Causal Forest (BCF). BCF allow us to capture the conditional average treatment effect (CATE) using regularization priors for nonlinear trends that can reveal even small effects and strong confoundedness. The analysis indicates considerable heterogeneity in small buying firms’ responses to specific promotions, demonstrating that a single strategy cannot cater universally. Entrepreneurs that exhibit higher purchasing frequency and volume tend to be more influenced by promotions; entrepreneurs that make more purchases respond negatively to lower value monetary promotions but appreciate high-value promotions. These insights underscore the need to tailor promotions strategically to match specific buying firms’ preferences, as a way to optimize the impact of promotions.

In this research, we conduct analytical and empirical analyses to assess the impact of Indian government-mandated firms’ corporate social responsibility (CSR) related investments on gross margins. Using a stylized analytical model, we theorize a positive relationship between CSR investments and gross margin ((price-cost)/price) and argue that advertising investments could enhance this relationship. In our empirical investigation, we evaluate the causal impact of CSR on gross margin premium, i.e., relative to the industry average. To get exogenous variation in CSR investments, we exploit India’s 2013 CSR rule, which mandates certain companies to invest in CSR. Using difference-in-differences and regression-discontinuity methodologies, we find strong support for our gross margin proposition and the advertising expenditure conjecture. The key insight is that consumers reward companies with a gross margin premium that commit to socially responsible activities and use advertising investments to spread awareness about those activities. We discuss our study’s implications for marketing literature that focuses on CSR and, for marketers and brand managers, the power of CSR to drive a marketing outcome that is of utmost importance to marketers.