The modeling and analysis of the word-of-mouth marketing

Pengdeng Li, Xiaofan Yang*, Luxing Yang, Qingyu Xiong, Yingbo Wu, Yuan Yan Tang

*Corresponding author for this work

Research output: Contribution to journalArticleScientificpeer-review

21 Citations (Scopus)

Abstract

As compared to the traditional advertising, word-of-mouth (WOM) communications have striking advantages such as significantly lower cost and much faster propagation, and this is especially the case with the popularity of online social networks. This paper focuses on the modeling and analysis of the WOM marketing. A dynamic model, known as the SIPNS model, capturing the WOM marketing processes with both positive and negative comments is established. On this basis, a measure of the overall profit of a WOM marketing campaign is proposed. The SIPNS model is shown to admit a unique equilibrium, and the equilibrium is determined. The impact of different factors on the equilibrium of the SIPNS model is illuminated through theoretical analysis. Extensive experimental results suggest that the equilibrium is much likely to be globally attracting. Finally, the influence of different factors on the expected overall profit of a WOM marketing campaign is ascertained both theoretically and experimentally. Thereby, some promotion strategies are recommended. To our knowledge, this is the first time the WOM marketing is treated in this way.

Original languageEnglish
Pages (from-to)1-16
Number of pages16
JournalPhysica A: Statistical Mechanics and its Applications
Volume493
DOIs
Publication statusPublished - 2018

Keywords

  • Differential dynamical system
  • Equilibrium
  • Global attractivity
  • Overall profit
  • Word-of-mouth marketing

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