Modeling Mgc Strategies under Extreme Negative Ugc

ABSTRACTThe impact of user-generated content (UGC), especially extreme negative UGC (EN_UGC) on firms is well recognized. Moreover, insightful qualitative marketer-generated content (MGC) strategies have been proposed to respond to negative UGC. However, few quantitative and analytical modeling studies have been conducted to explore the effectiveness of each proposed strategies under different scenarios to counteract EN_UGC. This research aims to explore optimal MGC strategies for firms to handle EN_UGC by proposing an EN_UGC propagation model based on MGC and EN_UGC interaction. We provide the runaway mode and effective mode in handling EN_UGC. Our results show that in runaway mode, MGC does not affect the propagation of EN_UGC, and the optimal MGC strategy is to do nothing. However, in effective mode, the effect strength of MGC on EN_UGC is the most important key factor in defending against EN_UGC propagation, followed by the input rate of the subgroup where users accept and repost MGC. Based on our model, we also explain why MGC strategies such as deleting post and employing paid posters are helpless in EN_UGC's management. Overall, the findings in this research offer some unique implications for UGC management.Keywords: User generated content; Marketer generated content; Runaway mode; Effective mode; Social media(ProQuest: . denotes formulae omitted.)1. IntroductionThe popularity and user-friendliness of social media has witnessed a dramatic increase in online user engagement with organizations [Susarla et al. 2012]. This engagement generates massive amount of user generated content (UGC). Firms have capitalized on the positive impact of UGC on brand value and revenue generation. However, users also say nasty things about firms and their brands. Thus, UGC can be negative or even extreme negative which has detrimental effect on firms and their brand value.For example, in 2010, Nestle, the world's biggest food manufacturer, had to face the tough criticism storm from social media. On March 17, 2010, Greenpeace as one of the largest environmental groups launched a "Have a break; have a Kit Kat" video on YouTube attacking Nestle's Kit Kat brand. Greenpeace had found that Nestle was sourcing palm oil from Sinar Mas, an Indonesian supplier that Greenpeace claimed was acting unsustainably. Millions of people watched the grisly video and posted angry messages on Nestle's Facebook page. In order to counteract the negative effect, Nestle attempted to use censorship to refrain the negative UGC and forced Greenpeace to withdraw the video from YouTube. However, the withdrawal did not stop the spreading of the message in social media. The withdrawal even made the situation worse. Main stream media also joined social media force. The censorship along with hostile and sarcastic message of Nestle toward consumers severely damaged the brand image of Nestle [Magee 2010]. This example illustrates if firms do not manage negative UGC appropriately, negative UGC can be detrimental.However, if firms can formulate sound social media strategies and take proper actions to take advantage of marketer generated content (MGC), they can mitigate the potential damage from UGC. Unfortunately, limited research especially quantitative and analytical modeling studies has been conducted on how firms should deploy MGC strategies to effectively respond to extreme negative UGC (EN_UGC) [Goh et al. 2013; Thomas et al. 2012; Ye et al. 2011]. Hence, it is worthwhile to identify the dynamic interaction mechanism between EN_UGC and MGC, and offer optimal MGC strategies to mitigate the damage from EN_UGC. We attempt to address the research gap in this research. Our contribution lies in that we propose the mathematical model and explore the conditions under which firms' MGC strategies for dealing with EN_UGC can be effective.The rest of the paper is arranged as the following. In Section 2, we provide literature review. …