Do Life-cycle and Generation Moderate Sentiment and Diffusion?

Abstract

ABSTRACT This study investigates the relationship between diffusion of new digital products and sentiment of product reviews with respect to the moderating effects of product generation and product life cycle. Results for a sample of 154 products and 105 thousand adopters show that the effect of sentiment on diffusion is significantly moderated by both product life cycle and production generation. Specifically, while there is a reciprocal causality between sentiment and diffusion in the early stage, the relationship is significantly weakened in the late stage of product life cycle. Moreover, while sentiment can trigger an effect on diffusion in a similar manner for both single- and multiple-generation products, the effect is likely to last longer for single-generation products than for multiple-generation products. The study discusses theoretical contributions to the Information System theory as well as practical contributions to the use of business intelligence platforms to manage product life cycle and product generation.