Contemporaneous and Delayed Sales Impact of Location-Based Mobile Promotions
Authors: Fang, Zheng; Gu, Bin; Luo, Xueming; Xu, Yunjie
Journal: Information Systems Research (2015)
<jats:p> Can location-based mobile promotion (LMP) trigger contemporaneous and delayed sales purchases? As mobile technologies can reach users anywhere and anytime, LMP becomes a promising new channel. We unravel the dynamic sales impact of LMP on the basis of a randomized field experiment with 22,000 mobile users sponsored by one of the largest mobile service providers in the world. Our identification strategy is to gauge the marginal increases in consumer purchases of the geo-fenced treatment group of users who received LMP, above and beyond the baseline control groups. There are two controls: one group who received the same LMP but not in the virtual geo-fencing locational range (nongeo-fenced control), and the other who did not receive the LMP but in the geo-fencing range (geo-fenced control). The latter control serves as an organic holdout baseline from the similar population, i.e., counterfactual test of what if without the mobile LMP intervention, to identify the actual “lift” of incremental purchases caused by the treatment with the mobile LMP intervention. Findings suggest that LMP treatment has a significantly stronger impact on contemporaneous (same-day) purchases and d…