Examining the role of the marketing activity and eWOM in the movie diffusion: the decomposition perspective

Abstract

Advertising as a direct marketing activity as well as word-of-mouth (WOM) as an indirect marketing activity are widely accepted as the most influential determinants of new product performance. Although electronic WOM (eWOM), as a type of WOM, has recently been studied extensively in various industries, previous results appear mixed due to their characteristics such as volume and valence. To bridge the gap regarding the roles of advertising and eWOM in the movie diffusion process, they were classified into pre-eWOM/advertising and post-eWOM/advertising based on two stages of the diffusion process. To reflect the heterogeneity of consumption characteristics on a new product, consumers were divided into two groups—innovators and imitators. This study proposed a model to investigate the role of advertising and eWOM in the movie diffusion process. In addition, the proposed model was used to analyze the impact of firm-initiated advertising and user-generated online reviews on movie performance in Korea.