Social Networks and their Economics -- Contents -- List of figures -- List of tables -- Preface -- Acknowledgements -- 1 Consumer choice in social networks -- 1.1 Motivation -- 1.2 Using mobile telecommunications to illustrate the economics of social networks -- 1.3 Structure of the book -- 1.4 Why you should read this book -- References -- 2 Research into social networks in economics, sociology and physics -- 2.1 Introduction -- 2.2 The economics of networks: Key findings from economics and marketing -- 2.2.1 Introduction -- 2.2.2 Definition of network effects -- 2.2.3 Direct network effects -- 2.2.4 Indirect network effects -- 2.2.5 Implications for company strategies -- 2.3 Social network analysis: Key findings from sociology -- 2.3.1 A short history -- 2.3.2 Network analysis basics -- 2.3.3 Design of social network studies -- 2.4 Key findings from physics research into complex networks -- 2.5 Empirical research on social networks and network effects -- 2.5.1 Introduction -- 2.5.2 Big data: Massive electronic social networks -- 2.5.3 Challenges when identifying causal relationships in social networks -- 2.5.4 Empirical strategies to identifying causal effects in social networks -- 2.5.5 Empirical challenges and advances in the economics of network literature -- 2.6 Summary -- References -- 3 Marketing in social networks: The iPhone -- 3.1 Executive summary -- 3.2 Case study 1: Social network and viral marketing -- 3.3 Case study 2: Social advertising on Facebook -- 3.4 Introduction to the empirical study -- 3.5 Product diffusion in social networks -- 3.6 Modelling diffusion in social networks -- 3.7 Model estimation -- 3.7.1 Description of the data used: Very large-scale mobile network -- 3.7.2 Description of the statistical method used: Survival analysis -- 3.8 Model results -- 3.8.1 Non-parametric tests -- 3.8.2 Variable definitions.

3.8.3 Model results: Impact of the social network on iPhone adoption -- 3.8.4 iPhone virality over time -- 3.9 Discussion -- References -- 4 Switching and churn in social networks -- 4.1 Executive summary -- 4.2 Case study: Customer retention in social networks -- 4.3 Introduction to the empirical study -- 4.4 Key findings from the switching cost literature -- 4.5 Modelling concept -- 4.6 Description of the data used: Another large-scale mobile network -- 4.7 Model results -- 4.7.1 Non-parametric tests -- 4.7.2 Variable definitions -- 4.7.3 Model results: Impact of the social network on customer churn -- 4.7.4 Robustness tests -- 4.8 Discussion -- References -- 5 How social networks influence consumer choice of mobile phone carriers in the UK, Europe and Asia -- 5.1 Executive summary -- 5.2 Case study: Using homophily for social network marketing -- 5.2.1 Mobile phone carriers -- 5.2.2 Online retailers -- 5.2.3 Online social networks -- 5.3 Introduction to the empirical study -- 5.4 Methodology -- 5.4.1 Design of the social network survey -- 5.4.2 Description of the statistical approach used: Quadratic assignment procedure -- 5.5 Understanding the properties of the social networks -- 5.5.1 Descriptive social network statistics -- 5.5.2 Graphical analysis of a social network -- 5.6 The impact of friendship on operator choice -- 5.7 Robustness of results -- 5.7.1 Non-respondents -- 5.7.2 QAP and multicollinearity -- 5.7.3 Ethnicity -- 5.8 Are stronger relationships more influential? -- 5.9 Friendship networks and choice of handset brand -- 5.10 Multi-country case study of operator choice in social networks -- 5.10.1 Malaysia -- 5.10.2 The Netherlands -- 5.10.3 Italy -- 5.10.4 Cross-country comparison -- 5.11 Discussion -- References -- 6 Coordination of mobile operator choice within households -- 6.1 Executive summary.

6.2 Case study: Social network marketing to communities -- 6.2.1 International communities -- 6.2.2 Families -- 6.3 Introduction to the empirical study -- 6.4 Data -- 6.5 Descriptive statistics -- 6.6 The model -- 6.7 Multinomial logit model -- 6.7.1 Model parameters -- 6.7.2 Base model -- 6.7.3 Relationship types within households -- 6.8 Multinomial probit model -- 6.8.1 Independence of irrelevant alternatives -- 6.8.2 Multinomial probit motivation -- 6.8.3 Estimation results -- 6.9 Discussion -- References -- 7 How pricing strategy influences consumer behaviour in social networks -- 7.1 Executive summary -- 7.2 Case study: Pricing digital products with network effects -- 7.2.1 Facebook -- 7.2.2 LinkedIn -- 7.3 Introduction to the empirical study -- 7.4 The mobile telecommunications industry in the UK -- 7.5 The model: Price discrimination between on- and off-net calls -- 7.6 Estimation results: Adapting consumption choice to price signals -- 7.7 Discussion -- References -- 8 Conclusions -- 8.1 Main results -- 8.2 Implications of interdependent consumer choice -- 8.2.1 For marketing practitioners -- 8.2.2 For academic researchers -- 8.2.3 For regulatory policy -- 8.3 Looking ahead: How social network analysis is changing research and marketing practice -- References -- Appendix A Success factors for viral marketing campaigns -- A.1 Proposition excellence -- A.2 Observability of the product or its use -- A.3 Design the campaign around a good understanding of the specific role of word-of-mouth in propagating your product -- A.4 Word-of-mouth for economic benefit -- A.5 Exploit storytelling and tap into the zeitgeist -- A.6 Exploit influential expert users -- A.7 Appeal to communities of interest -- A.8 Conclusion -- References -- Appendix B Student questionnaire -- Index -- Supplemental Images.