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Marketing Letters

, Volume 27, Issue 1, pp 1–13 | Cite as

The impact of social media conversations on consumer brand choices

  • Yizao Liu
  • Rigoberto A. Lopez
Article

Abstract

This paper estimates the impact of social media conversations on consumer valuation of brand characteristics and demand for carbonated soft drinks (CSDs). We formulate a random coefficient, discrete choice model of consumer demand that includes social media conversations, and estimate it matching Nielsen sales data on carbonated soft drinks to social media conversations on Facebook, Twitter, and YouTube. Empirical results indicate that consumers’ conversations about brands and nutritional aspects of CSDs have a significant impact on their valuation of brand characteristics and ultimately on their choices of CSDs. These findings have important implications not only for firms using social media as a strategic tool for effective brand promotion and product design but also for public health policies aimed at reducing the consumption of sugary beverages and high-calorie foods.

Keywords

Social media Word-of-mouth Demand Consumer behavior Internet Carbonated soft drinks 

JEL Classification

D12 M37 L66 

Notes

Acknowledgments

The authors acknowledge funding from the Zwick Center for Food and Resource Policy at the University of Connecticut via USDA-NIFA Grant 2010-306-34178-20766.

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Copyright information

© Springer Science+Business Media New York 2014

Authors and Affiliations

  1. 1.Department of Agricultural and Resource EconomicsUniversity of ConnecticutStorrsUSA
  2. 2.Department of Agricultural and Resource Economics, Director of the Zwick Center for Food and Resource PolicyUniversity of ConnecticutStorrsUSA

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