What Motivates User-Generated Content? Small Monetary Rewards Backfire Again

June 09, 2017

In a post on LinkedIn, Vice President Kristina Shampanier of Analysis Group summarizes an article in the INFORMS journal Marketing Science questioning the degree to which monetary rewards and number of social connections are factors in motivating consumers to write online reviews. In the article, “Motivation of User-Generated Content: Social Connectedness Moderates the Effects of Monetary Rewards,” authors Yacheng Sun, Xiaojing Dong, and Shelby McIntyre combine real consumer data with a difference-in-differences regression methodology to examine the effect of incentives on online community members with differing levels of social connectedness. The research revealed that review contributions increased for the less-connected members of an online community when financial compensation was involved, but decreased for the more-connected members, suggesting that connected members are less likely to exchange reviews for money due to the greater visibility of their actions. According to Dr. Shampanier, the authors conclude that small monetary incentives do not always generate a business's desired outcome, and that businesses should realize there are unintended consequences when attempting to financially motivate well-connected users to create user-generated content. Dr. Shampanier also proposes that further research, ideally, field experiments, be undertaken to explore alternative structures under which highly-connected users might be incentivized to provide content.

Dr. Shampanier's commentary is published in her role as a Marketing Sciences Ambassador, an initiative of the INFORMS journal Marketing Science to promote increasing awareness of leading-edge academic research among practitioners.

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