KOREASCHOLAR

Daily deals sites function as an effective promotional tool for low-budget offline retailers. In particular, social interaction helps increasing sales because it not only clarifies product information but also increase product awareness. This study investigates two forms of social interaction, public discussion (posting on the within-platform deal board) and social sharing (sharing the deal information on an external SNS platform). In addition to the innate attractiveness of the deal, we hypothesize that the online and offline contexts affect the amount of social interaction. That is, (1) number of deals that are present along with the focal deal in the online platform and (2) the retail environment of the service offered in the deal affect the degree to which users participate in social interaction. An empirical analysis of deal-level data shows that the contextual factors, along with the deal attractiveness, affect the amount of social interaction. However, the effects are distinct for public discussion and social sharing. When there is a larger number of similar deals on the platform, less public discussion takes place while social sharing proliferates. Offline retail environment only affects public discussion; larger retailer revenue in the area that the deal provider is located results in greater social interaction. The innate attractiveness of the deal, defined as the past performance of deals of the same category in the same region, has contrasting effect on the two types; high attractiveness results in more public discussion but less social share. The results suggest that small offline retailers can better manage social interaction by understanding the influence of contextual factors when promoting their service products on an online platform.

• Jeonghye Choi(Yonsei University, Republic of Korea)