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Consumer Online Search and New-Product Marketing

This dissertation contains three essays that study the implications of online search activity for new-product marketing. Using the U.S. motion picture industry as a test case, the first essay examines the dynamic causal relationship between traditional media, consumers’ media generation activity, media consumption activity, and market demand of movies. Consumers’ media generation and consumption activities around movies are operationalized by the blog volume and search volume of those movies. I develop three separate models—a pre-launch period model, a post-launch period model, and an opening-week model—and examine the relationship between them separately for each period. As the focal variables are jointly determined, I introduce instruments and explain how to correct for endogeneity bias. I find that consumer searching activity is a key mediator between advertising, consumer blogging activity, and market demand.

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