Factors Affecting Organisational Environment

Factors Affecting Organisational Environment One of the factors that affects organization-environment relationships is environmental change and complexity. The environment can be described along two dimensions which are its degree of change and its degree of homogeneity. The degree of change is the extent to which the environment is relatively stable or relatively dynamic. The degree of homogeneity of the environment is relatively simple (with some elements, a small portion) or complex (multi-element, much segmentation). These two aspects interact to determine the uncertainty facing the organization. The least environmental uncertainty is faced by organizations with stable and simple environments. The degree of homogeneity and the degree of change combine to create uncertainty for organizations. For example, a simple and stable environment creates the least uncertainty, and a complex and dynamic environment creates the most uncertainty. The University of Manchester provides exceptional learning environments which are highly int eractive online learning tools with our high quality, face to face teaching to provide all the students with a richer learning experience. The University of Manchester committed to creating contemporary, technology-rich and learning specs that bring students into the heart of a required learning experience through their investment in their campus and facilities. And they have the largest collection of books electronic resources of any UK university, and extensive coverage of Wi-Fi on campus. The university library is one of the largest and best-resourced in the UK. With more than four millions books, it also provides a collection of electronic resources unrivalled by any other British university. Professional library stuff provides every student with a full introduction to services, resources and how to make the most of them, and are also on hand throughout your time at the university to provide advice, training and help whenever you need it. And of course, if you have any special needs, facilities and help are provided here too. Manchesters IT provision is constantly growing and being updated to satisfy the rigorous de mands of the most computer-literate of students. But even if youve never graduated beyond a games console, theres no cause for concern.    The University provides guidance, training and support to help you keep abreast of the latest computer programmes and electronic information resources. When you become a student at Manchester, you will be registered for email, file storage and internet access. Computer clusters pepper the campus, many within individual Schools and halls of residence. The biggest computer clusters are located in the main Library and George Kenyon Building. Several of these clusters are open 24 hours a day. More powerful workstations are available to support specialist research applications. Organizations with dynamic but simple environment generally face a moderate degree of uncertainty. Examples of organizations functioning in such environments include music producers (catering faces relatively few competitors (diesel, Lee, and Wrangler), has few suppliers and few regulators and uses limited distribution channels. This relatively simple task environment, but also changes very rapidly as competitors a djust prices and styles, changing consumer tastes and new fabrics become available. Another combination of factors is one of stability and complexity. Toyota, Honda and Nissan face these basic conditions. After all, they must interact with consumer groups, regulators, suppliers and competitors. However, occurs quite slowly in the automobile industry. It is just like how the University of Manchester used the same concept of the environmental change and complexity. The second point of how environments affect organizations is competitive forces. Competitive forces is forces in the marketing environment or educational environment that are based on competition among customers and compete with other firms. As the organization looks out at its business environment, competition is a critical factor. Who is buying goods and services and who is providing them to those customers? Are there many competitors or are there just a few? Maybe none. Knowing what competitive forces exist helps an orga nization develop strategic planning to attract customers. As for the university, the university has a very high-quality research profile. In the first national assessment of higher education research since the universitys founding, the 2008  Research Assessment Exercise, the University of Manchester came 3rd in terms of research power after Cambridge and Oxford and 6th for grade point average quality (8th when including specialist institutions).    Accordingly, Manchester enjoys the largest amount of research funding behind Oxbridge, UCL and Imperial  (these five universities being informally referred to as the golden diamond of research-intensive UK institutions). Manchester also has a particularly strong presence in terms of funding from the three main UK research councils,   EPSRC, MRC  and  BBSRC, being ranked 3rd, 7th  and 1st  respectively. In addition, the university is also one of the richest in the UK in terms of income and interest from endowments: at a recent rank, it was placed at 3rd place behind Oxbridge. Historically, Manchester has been linked with high scientific achievement: the university and its constituent former institutions combined had  25 Nobel Laureates  among their students and staff, the third largest number of any single university in the United Kingdom behind  Oxford  and  Cambridge; in fact, excluding Oxbridge, Manchester has graduated more  Nobel laureates  than any othe r university in the UK. Furthermore, according to an academic poll two of the top ten discoveries by university academics and researchers were made at the University (namely the first working computer and the contraceptive pill). The university currently employs 4 Nobel Prize winners amongst its staff, more than any other in the UK. The 2009  THE-QS World University Rankings  found Manchester overall 26th in the world and 5th by employer reviews by receiving a maximum 100% rating which the university has retained since 2008. The separate 2010  QS World University Rankings  (in 2010  Times Higher Education World University Rankings  and  QS World University Rankings  parted ways to produce separate rankings) found that Manchester had slipped to 30th in the world. The  Academic Ranking of World Universities  2008 published by the Institute of Higher Education of  Shanghai Jiao Tong University  ranked Manchester 5th in the UK, 6th in Europe and 40th in the world . After several years of steady progress, Manchester fell back in 2009 to 41st in the world and 7th in Europe, falling back further to 44th in the world and 9th in Europe in 2010. Excluding US universities, Manchester is ranked 13th and 11th in the world for 2009 by THES and ARWU respectively. According to the ARWU rankings, the university is ranked 9th in Europe for natural sciences and 4th in engineering. Similarly the  HEEACT  2009 rankings for scientific performance place Manchester 5th in Europe for engineering, 8th for natural sciences  and 3rd for social sciences. And finally THES ranks Manchester 6th in Europe for technology, 10th for life sciences  and 7th for social sciences. More recently a survey by the Times Higher Education Supplement has shown that Manchester is placed 6th in Europe in the area of Psychology Psychiatry. According to a further ranking by SCImago Research Group Manchester is ranked 8th in Europe amongst higher education institutions in terms of sheer research output. In terms of research impact, a further ranking places Manchester 6th in Europe. According to the High Fliers Research Limiteds survey, University of Manchester students are being targeted by more top recruiters for graduate vacancies than any other UK university students for three consecutive years (2007-2009). Furthermore, the university has been ranked joint 20th in the world for 2009 according to the Professional Ranking of World Universities. Its main compilation criterion is the number of Chief Executive Officers (or number 1 executive equivalent) which are among the 500 leading worldwide companies as measured by revenue who studied in each university. The ranking places the University only behind Oxford nationally. Manchester is ranked 5th among British universities according to a popularity ranking which is based on the degree of traffic that a universitys website attracts. Also, a further report places Manchester among the top 20 universities outside the US. At a recent ranking undertaken by the Guardian, Manchester is placed 5th in the UK in internation al reputation behind the usual four: Oxbridge, UCL and Imperial. However, while as a rule world rankings (such as the ARWU, THES and HEEACT) typically place the university within the top 10 in Europe, national studies are less complimentary; The Times Good University Guide 2011 ranked Manchester 30th out of 113 Universities in the UK, The Complete University Guide2011 in association with The Independent placed it at 31st out of 115 universities whilst The Guardian University Guide 2011 ranked Manchester at 51st out of 118 universities in the UK. This apparent paradox is mainly a reflection of the different ranking methodologies employed by each listing: global rankings focus on research and international prestige, whereas national rankings are largely based on teaching and the student experience. The last point on how environments affect organizations is environmental turbulence. Environmental turbulence refers to the amount of change and complexity in the environment of a company. The greater the amount of change in environmental factors, such as technology and governmental regulations, and the greater the number of environmental factors that must be considered, the higher the level of environmental turbulence. For many reasons, environmental volatility and instability have been increasing for the past 100 years. Although often experience unexpected changes and upheavals, the five could still compete for the review and evaluation system, and development plans to address these issues.   At the same time, despite the changes in the environment or the occasional long-wave instability is not the most common form of the organization warned, there may be some form of crisis. One of the crisis is to get the attention of managers in recent years is workplace violence-situations in which disgruntled workers or former workers assault other employees, resulting often in injury and sometimes in death. The recession began in 2009 and concerns about the H1N1 (swine) flu virus in 2009 are other recent examples. The impact of crisis affects the organizations in different ways, and some organizations have developed crisis plans and teams. For example, during the H1N1 virus scare in 2009, one investigation reported that only 27 per cent of all United States employers had their plans for dealing with such a potential health crisis. In view of numerous problems, difficulties, and the environment in an organization, how should the organization adapt? Clearly, each organization must assess its own unique situation and adapt according to the wisdom of its senior management. Organizations attempt to their environments. The most common methods are information management; strategic response; mergers, acquisitions, and alliances; organization design and flexibility; direct influence; and social responsibility. One way in which organizations adapt to their environments is through information management. Information management  (IM) is the collection and management of  information  from one or more sources and the distribution of that information to one or more audiences. This sometimes involves those who have a stake in or a right to that information.   Management  means the organization of and control over the structure, processing and delivery of information. Throughout the 1970s this was largely limited to files, file maintenance, and the  life cycle management  of paper-based files, other media and records. With the proliferation of information technology starting in the 1970s, the job of information management took on a new light, and also began to include the field of  Data mainte nance. No longer was information management a simple job that could be performed by almost anyone. An understanding of the technology involved and the theory behind it became necessary. As information storage shifted to electronic means, this became more and more difficult. By the late 1990s when information was regularly disseminated across computer networks and by other electronic means, network managers, in a sense, became information managers. Those individuals found themselves tasked with increasingly complex tasks, hardware and software. With the latest tools available, information management has become a powerful resource and a large expense for many organizations. In short, information management entails organizing, retrieving, acquiring and maintaining information. It is closely related to and overlapping with the practice of Data Management. Other than information management, there is another way that an organization adapts to its environments is through a strategic respon se. If the market is growing rapidly as a company, the firm may decide to invest even more heavily in products and services for that market. Similarly, if the market is shrinking or without the possibility of reasonable growth, the company may decide to cut back. A related strategic approach that some organizations use to adapt to their environments involves mergers, acquisitions, and alliances. A merger is the combining of two or more companies, generally by offering the stockholders of one company securities in the acquiring company in exchange for the surrender of their stock. An  acquisition, also known as a  takeover  or a  buyout, is the buying of one company (the target) by another. Consolidation is when two companies combine together to form a new company altogether. An acquisition may be private or public, depending on whether the acquiree or merging company is or isnt listed in public markets. An acquisition may be  friendly  or hostile. Whether a purchase is p erceived as a friendly or hostile depends on how it is communicated to and received by the target companys board of directors, employees and shareholders. It is quite normal though for MA deal communications to take place in a so-called confidentiality bubble whereby information flows are restricted due to confidentiality agreements (Harwood, 2005). In the case of a friendly transaction, the companies cooperate in negotiations; in the case of a hostile deal, the takeover target is unwilling to be bought or the targets  board  has no prior knowledge of the offer. Hostile acquisitions can, and often do, turn friendly at the end, as the acquirer secures the endorsement of the transaction from the board of the acquired company. This usually requires an improvement in the terms of the offer. Acquisition usually refers to a purchase of a smaller firm by a larger one. Sometimes, however, a smaller firm will acquire management control of a larger or longer established company and keep i ts name for the combined entity. This is known as a  reverse takeover. Another type of acquisition is a reverse merger, a deal that enables a private company to get publicly listed in a short time period. A  reverse merger  occurs when a private company that has strong prospects and is eager to raise financing buys a publicly listed shell company, usually one with no business and limited assets.    Achieving acquisition success has proven to be very difficult, while various studies have shown that 50% of acquisitions were unsuccessful. The acquisition process is very complex, with many dimensions influencing its outcome. A  business alliance  is an agreement between businesses, usually motivated by cost reduction and improved service for the customer. Alliances are often bounded by a single agreement with equitable risk and opportunity share for all parties involved and are typically managed by an integrated project team. An example of this is  code sharing  in airline alliances. An organization may also adapt to environmental conditions by incorporating flexibility in its structural design. For example, a company in an uncertain business environment, relatively low levels may choose to use many of the basic rules, regulations and standard operating procedures of the design. The latter sometimes referred to as an organic design, is considerably more flexible and allow t he organization to respond quickly to environmental change. Organizations are not necessarily helpless in the face of their environments. In fact, many organizations are able to directly influence their environments in many different types of ways. The organization also influences their customers by creating new users for a product, stealing customers away from competitors, and also convincing customers that they need something more new and updated. Another way that an organization adapts to its environments is through social responsibility. Social responsibility  is the principle that companies should contribute to the welfare of society and not be solely devoted to maximizing profits. This responsibility can be negative, meaning there is an exemption from blame or liability, or it can be positive, meaning there is a responsibility to act beneficently (proactive stance). Specifically, social responsibility is the set of obligations an organization has to protect and enhance the societal context in which it functions. A number of organizations recognize that in all three areas of responsibility, every effort to meet each of them, while others emphasize only one or two areas of social responsibility. And a few acknowledge no social responsibility at all. In addition, the views of social responsibility vary in different countries.

Ethical Dimensions of Preparing Two Financial Reports Essay

Ethical dimensions of financial accounting with respect to keeping of two sets of records, one for internal purposes only and the other for internal taxation purposes. Financial accounting, as stated by Garrison, is concerned with providing information those people outside an organization. This includes preparation of financial reports showing the company’s past financial performance which will be the basis for additional investments for stockholders, capacity to pay off loans for creditors or banks, imposing correct government taxes as mandated by law, etc. Financial reports, therefore, should be done accurately and with utmost truthfulness to avoid misconstruction due to omission or misstatement as stated in the International Federation of Accountants Code of Ethics. However, there are some who do not conform to this Code. Some companies practice preparation of two sets of financial reports at the end of the fiscal year, one for internal purpose and the other to be used and submitted for internal taxation purpose. Usually, if the company would like to attract additional investments from its stockholders, incomes are bloated. On the other hand, to avoid paying high taxes or even pay no taxes at all, financial statements are manipulated to reflect a lower or negative net income, which will be the basis for the computation of the taxes to be paid by the company. Whether for stockholders or for taxation, I strongly condemn such practice. This does not only violate the Code of Ethics of IFAC, such practice, if done continually, could even be a start of the eventual downfall of any company due to loss of its credibility and integrity. Thus, there exist major financial scandals that lead to collapse of business giants like what happened to ENRON. Further, leaders of the company may suffer from huge penalties or even jail terms, if found guilty of violating the code. Sadly, our country’s system on taxation and how the government use, or should I say, misuse collected taxes opens a lot of controversies and issues, which is being used by some companies to justify the practice of preparing a different financial report for taxation purpose. Corruption and issues on tax evasion by big companies are only a few examples why some companies validate this act. Corporate governance, as they say, should start first with the government, ethical behavior should be practiced first by our government leaders. This is the main campaign of incumbent President PNoy. The Code of Ethics on Integrity Rules states: â€Å"A member must not make, prepare, or certify, or permit or direct another person to make, prepare or certify, any statement which the member knows, believes or ought to

American Colonies The Settling Of North America - 902 Words

SH â€Å"American Colonies: The Settling of North America† Introduction 1. Between 1492-1776, although many people moved to the â€Å"New World†, North America lost population due to the amount of Indians dying from war and diseases and the inability of colonists to replace them. John Murrin states, â€Å"losers far outnumbered winners† in â€Å" a tragedy of such huge proportions that no one’s imagination can easily encompass it all.† This thought of a decreasing population broadens one’s perspective of history from that of an excluded American tale full of positivity to that of a more unbiased, all-encompassing analysis. The Indians and slaves have recently been noted as a more crucial part of history than previously accredited with. 2. European exploration, in its entirety, is a complex subject with many causes and effects. In the attempt to break away from their previous home, colonists experienced a novel mixing of a variety of life, people plants and animals included. Africans, Europeans, and Indians all became acquainted in a new medley of a society. Each group, all with a unique cultural background, found a common identity as Americans due to the many new encounters and new neighbors. This was the beginning of the melting pot America is today. With â€Å"profit-seeking and soul-seeking† as the motive, Europeans concentrated the many cultures in young America. 3. Race was a key component of the new world, as the various people were not of equal power. Europeans, far more technologicallyShow MoreRelatedAmerican Colonies : The Settling Of North America By Alan Taylor1776 Words   |  8 Pages2015 Reading Assignment AP U.S. History American Colonies: The Settling of North America by Alan Taylor Introduction:Why does Alan Taylor believe that it is important to revise our traditional view of colonial history? The American Colonies draw upon three especially productive lines of recent scholarship: an Atlantic perspective, environmental history, and ethno history of colonial and native peoples. Alan Taylor believes in order to understand North America you have to view each perspective independentlyRead MoreThe British North American Colonies857 Words   |  4 Pages At the dawn of the 17th Century, England was in a suitable position to colonize North America. England had finally reached peace with Spain, and England had many workers willing to travel to America for a chance at religious freedom, affluence, and exploration. Aided by the funding of the Virginia Company, roughly one hundred English settlers landed on the North American shore in 1607, at a place they would name Jamestown. 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They faced many obstacles and challenges trying to establish the colony of Roanoke. Before the English ventured to Roanoke Europeans explored and settled the New World. The Spanish were the most successful in settling the New World. They conquered most of Central and South America. Their main objective was to convert all of the Indians to Christianity. â€Å"Spain’s claim to posses the Americas was based on discovery, conquest, and settlement

By Thomas Chatterton Williams s Poem, As Black - 908 Words

In his essay, â€Å"As Black as We Wish to be,† author Thomas Chatterton Williams tries to paint a picture of a world where the sight of interracial families was still considered an oddity and shows how, over the decades, society has slowly became more acceptable towards the idea. He begins the essay briefly discussing the ignorance of people during the late 1980’s while also elaborating what hardships African Americans have dealt with over the past century. He explains that even with the progression of interracial families and equality of African Americans, a new problem has now risen for interracial children of the future. While either being multiracial, African American, or White, what do they decide to identify themselves as? This is the major question that arises throughout Williams’s argument. While Williams’s supports his argument with unreliable environmental evidence, as well with other statistical evidence. His argument is weakened by an abundanc e of facts, disorganization, and an excessive use of diluted information. Williams introduces his argument by briefly explaining the ignorance he has dealt with while growing up as an interracial child. Even though he grew up in a time period of unequal rights, he acknowledges in his argument that nowadays â€Å"Some of 35 percent of Americans say that a member of their immediate family or a close relative is currently married to someone of a different race.†(Par 3). While this argument is completely hearsay and very broad, it does

The Significance of the Handkerchief in Othello by...

The handkerchief is significant to the plot, mainly to Iagos manipulation of Othello and his convincing the latter of Desdemonas infidelity. Moreover, it sheds light over Iago, Desdemona, Othello and Emilias characters, and is thus important to characterisation. The symbolic significance attached to the handkerchief reveals Othellos social background, his treatment of Desdemona and the latters feelings towards her husband. Interestingly, Othello provides two sides of the story of how he got the handkerchief. In his second account he says that his father gave the handkerchief to his mother as a sign of love when beforehand he states that it was actually an Egyptian woman who provided it to his mother. This interpretation reveals†¦show more content†¦The red strawberries , which Othello states were hand stitched, symbolises the blood of loss of virginity, so Othello perceives that Desdemona is chaste if she is in possession of the handkerchief. Once she loses it, she loses her chastity. With regards to plot, the handkerchief provides the sole ocular proof of Desdemonas unfaithfulnes, which infact triggers Othellos madness. The fact that Othello insists on gathering proof suggests that he is somewhat hopeful, Ill have some proof. It is worth noticing Desdemonas mistake in Act 3 Scene 4 when Othello demands to see the handkerchief, as she lies and says, It is not lost. This further convinces Othello of her infidelity. Moreover, it makes Emilia aware of Othellos jealous nature and she tries, unsuccessfully to warn Desdmona about her husbands insecurity, They are never jealous for the cause,/ But jealous for theyre jealous.; Iago further drives Othello into his raging madness by continously mentioning the handkerchief. The impact this leaves on him is evident in his repition of handkercief when Othello falls in a trance, Handkerchief-confessions-handkerchief? When Bianca walks in on Cassio and Iagos conversation, which Othello is spying on, she is holding t he handkerchief, which thus causes Othellos ravenous thirst for revenge. Thus, it plays an important part in leading to the tragedy of the Moor and to Desdemona;s death. In Act 5 Emilia revelas that she stole theShow MoreRelatedThe Symbolism Of Othello By William Shakespeare958 Words   |  4 Pagestreasure it as long as I live. In William Shakespeare’s play, Othello, the symbolism of Desdemona’s handkerchief is central to the play’s tragic dà ©nouement. The handkerchief serves a very important role in shaping the story to the way it is, it ultimately becomes the reason for Othello’s brutal murder of his wife, Desdemona. In addition, the handkerchief is shown as a symbol of â€Å"different things from various events in this play† (Othello). 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Portraying the actions of a noble Moor who brutally sacrifices his beloved wife over a strategically placed handkerchief, or Justifying Iago, whose evil manoeuvrings create an irrevocable wreckage out of the lives of at least six people, all because he wasRead MoreThe Significance of the Handkerchief in Othello823 Words   |  4 Pagesfabric manifest so much havoc? In William Shakespeare’s Othello, there is great significance of a powerful symbol that completely alters the fate of the story. â€Å"In the case of the handkerchief, it stands for several things, things that cannot be seen† (Hacht 663). This symbol, the handkerchief, is given to Desdemona by Othello, as a token of his love, and to their new beginnings as husband and wife. However, the mean ing of the handkerchief is viewed differently in various characters perspectives

Key Success Factors for Online Advertising Free Essays

Social Advertising Catherine Tucker? February 15, 2012 Abstract In social advertising, ads are targeted based on underlying social networks and their content is tailored with information that pertains to the social relationship. This paper explores the e? ectiveness of social advertising using data from ? eld tests of di? erent ads on Facebook. We ? nd evidence that social advertising is e? ective, and that this e? cacy seems to stem mainly from the ability of targeting based on social networks to uncover similarly responsive consumers. We will write a custom essay sample on Key Success Factors for Online Advertising or any similar topic only for you Order Now However, social advertising is less e? ective if the advertiser explicitly states they are trying to promote social in? uence in the text of their ad. This suggests that advertisers must avoid being overt in their attempts to exploit social networks in their advertising. Catherine Tucker is Associate Professor of Marketing at MIT Sloan School of Management, Cambridge, MA. and Faculty Research Fellow at the NBER. Thank-you to Google for ? nancial support and to an anonymous non-pro? t for their cooperation. Thank-you to Jon Baker, Ann Kronrod, Preston Mcafee, and seminar participants at the George Mason University Roundtable on the Law and Economics of Internet Search, the University of Rochester, UCLA and Wharton for valuable comments. All errors are my own. ? 1 Electronic copy available at: http://ssrn. com/abstract=1975897 1 Introduction Recent advances on the internet have allowed consumers to interact across digital social networks. This is taking place at unprecedented levels: Facebook was the most visited website in the US in 2010, accounting for 20% of all time spent on the internet, a higher proportion than Google or Yahoo! ComScore, 2011). However, it is striking that traditional marketing communications have been at the periphery of this explosion of social data despite the documented power of social in? uence on purchasing behavior. Much of the emphasis on marketing in social media, so far, has been on the achievement of ‘earned reach,’ whereby a brand builds it s subscriber base organically and also hopes that this will in? uence others organically through sharing links with their social networks (Corcoran, 2009). However, recent research by Bakshy et al. 2011) has emphasized that this kind of organic sharing is far rarer than previously supposed, and that there are very few examples of a commercial message being consistently transmitted across social networks. Further, Tucker (2011a) shows that in order to achieve virality, an advertiser may have to sacri? ce the commercial e? ectiveness of their message. This means that advertisers may need to use paid advertising to facilitate the sharing of their commercial message through social networks. Both Facebook and LinkedIn have recently introduced a new form of advertising called ‘social advertising. A social ad is an online ad that ‘incorporates user interactions that the consumer has agreed to display and be shared. The resulting ad displays these interactions along with the use r’s persona (picture and/or name) within the ad content’ (IAB, 2009). This represents a radical technological development for advertisers, because it means that potentially they can co-opt the power of an individual’s social network to target advertising and engage their audience. This paper asks whether social advertising is e? ective, and what active steps advertisers themselves should take in their ads to promote social in? ence. 2 Electronic copy available at: http://ssrn. com/abstract=1975897 We explore the e? ectiveness of social ads using data from a ? eld experiment conducted on Facebook by a non-pro? t. This ? eld experiment compared the performance of social ads with conventionally targeted and untargeted ads. The social ads were targeted to the friends of ‘fans’ of the charity on Facebook. The ads featured that fan’s name and the fact that they had become a fan of this charity. We ? nd that on average these social ads were more e? ective than demographically targeted or untargeted ads. Further, this technique is useful for improving both the performance of demographically targeted and untargeted campaigns. Comparing the performance of these ads that contained the name of the fan and were targeted towards the fan’s friends with those that were simply targeted to that fan’s friends suggests that their e? ectiveness stems predominantly from the ability of social targeting to uncover similarly responsive consumers. We present results that suggest that as well as being more e? ective at gathering clicks, social advertising is also more e? ective at promoting actual subscriptions to the newsfeed and is more cost-e? ctive. We then turn to investigate how advertisers should word their social advertising. Through randomized ? eld tests, we investigate the e? ectiveness of advertisers deliberately promoting social in? uence in their advertising copy through including a statement that encourages the viewer to, for example, ‘be like their friend. ’ W e ? nd that consumers reject attempts by advertisers to explicitly harness or refer to a friend’s actions in their ad copy. This result contrasts with previous empirical research that ? nds consistent bene? ts to ? rms from highlighting previous consumer actions to positively in? ence the consumers’ response (Algesheimer et al. , 2010; Tucker and Zhang, 2011). This rejection is reasonably uniform across di? erent wording, though slightly less severe for ads that make a less explicit reference to friendship. We then present additional evidence to rule out two potential explanations for our ? ndings. First, we rule out that the overt mention of social in? uence simply made people aware they were seeing an ad rather than something organic to the site. We do this by comparing an ad that states it is an ad with an ad that does not, and ? nding no di? rence. 3 Second, to investigate whether it was simply bad advertising copy, we examined how the ads perform for a group of Fa cebook users who have shown a visible propensity for social in? uence. We identify such users by whether or not they have a stated attachment to a ‘Fashion Brand’ on their Facebook pro? le. These users, in contrast to our earlier results, react more positively to the advertiser explicitly co-opting social in? uence than to a message that did not. This suggests that it was not simply that the message was badly communicated, but instead re? cts a taste (or more accurately distaste) for explicit references to social in? uence among most, though not all, consumers. This research builds on a literature that has studied the interplay between social networks and word of mouth. Zubcsek and Sarvary (2011) present a theoretical model that examines the e? ects of advertising to a social network, but assume that a ? rm cannot directly use the social network for marketing purposes. Instead, ? rms have to rely on consumers to organically pass their advertising message within the soci al networks. There has been little work on advertising in social networks. Previous studies in marketing about social network sites have questioned how such sites can use advertising to obtain members (Trusov et al. , 2009), and also how makers of applications designed to be used on social network sites can best advertise their products (Aral and Walker, 2011) through viral marketing. Hill et al. (2006) show that phone communications data can be used to predict who is more likely to adopt a service, Bagherjeiran et al. (2010) present a practical application where they use data from instant messaging logs at Yahoo! to improve online advertising targeting, and similarly Provost et al. 2009) show how to use browsing data to match groups of users who are socially similar. Tucker (2011b) explores how privacy controls mediate the e? ectiveness of advertising on Facebook. However, to our knowledge this is the ? rst academic study of the e? ectiveness of social advertising. Managerially, our results have important implications. Social advertising and the use of onl ine social networks is e? ective. However, when advertisers attempt to reinforce this social 4 in? uence in ad copy, consumers appear less likely to respond positively to the ad. This is, to our knowledge, the ? st piece of empirical support for emerging managerial theories that emphasize the need for ? rms to not appear too obviously commercial when exploiting social media (Gossieaux and Moran, 2010). 5 2 Field Experiment The ? eld experiment was run by a small non-pro? t that provides educational scholarships for girls to attend high school in East Africa. Without the intervention of this non-pro? t, and other non-pro? ts like them, girls do not attend secondary school because their families prioritize the education of sons. Though the non-pro? t’s main mission is funding these educational scholarships, the non-pro? has a secondary mission which is to inform young people in the US about the state of education for African girls. It was in aid of this secondary mission that t he non-pro? t set up a Facebook page. This page serves as a repository of interviews with girls where they describe the challenges they have faced. To launch the ? eld experiment, the non-pro? t followed the procedure described in ‘A/B Testing your Facebook Ads: Getting better results through experimentation’ (Facebook, 2010) which involved setting up multiple competing campaigns. These ad campaigns was targeted to three di? erent groups as shown in Table 1. The ? st group was a broad untargeted campaign for all Facebook users aged 18 and older in the US. The second group were people who had already expressed interest in other charities. These people were identi? ed using Facebook’s ‘broad category targeting’ of ‘Charity + Causes. ’ The third group were people who had already expressed an interest in ‘Education + Teaching. ’ Previously, the charity had tried such reasonably broad targeting with little success and was hopeful that social advertising would improve the ads’ performance (Tucker, 2011b). In all cases, the charity explicitly excluded current fans from seeing its ads. For each of these groups of Facebook users, the non-pro? t launched a socially targeted variant. These ads employed the Facebook ad option that meant that they were targeted only to users who were friends of existing fans of the charity. This also meant that when the fan had not opted-out on Facebook, the ad also displayed a ‘social endorsement’ where the name of the friend was shown at the bottom of the ad as shown in Figure 1. 6 Table 1: Di? erent Groups Targeted Condition Untargeted Baseline: Only Shown Baseline text All people in US over age of 18 who are not fans of the non-pro? t already. All people in US over age of 18 who state a? nity with charities on their Facebook pro? le who are not fans of the non-pro? t already. All people in US over age of 18 who state a? nity with education on their Facebook pro? le who are not fans of the non-pro? t already. Social Variant: Shown all 5 texts from Table 2 All people in US over age of 18 who are friends of the non-pro? t’s supporters who are not fans of the non-pro? t already. All people in US over age of 18 who state a? nity with charities on their Facebook pro? le who are friends of the non-pro? t’s supporters who are not fans of the nonpro? already. All people in US over age of 18 who state a? nity with education on their Facebook pro? le who are friends of the non-pro? t’s supporters who are not fans of the nonpro? t already. Charity Education The non-pro? t varied whether the campaign was demographically targeted and whether the campaign was socially targeted, and also explored di? erent ad-text con ditions. Table 2 describes the di? erent ad-copy for each condition. Each di? erent type of ad-copy was accompanied by the same picture of an appealing secondary-school student who had bene? ted from their program. The socially targeted ads displayed all ? ve variants of the advertising message depicted in Table 2. For each of the non-socially-targeted campaigns, we ran the baseline variant of the ad text which, as shown in Table 2, simply says ‘Help girls in East Africa change their lives through education. ’ The non-pro? t could not run the other four conditions that refer to others’ actions, because federal regulations require ads to be truthful and they did not want to mislead potential supporters. The di? erent ad conditions were broadly designed to cover the kinds of normative and informational social in? ence described by Deutsch and Gerard (1955); Burnkrant and Cousineau (1975). 1 We want to be clear that we do not argue that these advertising measures 1 Other forms of social in? uence studied in the literature involve network externalities where there is a performance bene? t to multiple people adopting (Tucker, 2008). However, that does not seem to be relevant 7 Ta ble 2: Di? erent Ad-Text Conditions Condition Baseline Be like your friend Ad-Text Help girls in East Africa change their lives through education. Be like your friend. Help girls in East Africa change their lives through education. Don’t be left out. Help girls in East Africa change their lives through education. Your friend knows this is a good cause. Help girls in East Africa change their lives through education. Learn from your friend. Help girls in East Africa change their lives through education. Don’t be left out. Your friend knows Learn from your friend. capture all types of social in? uence or are necessarily successful at distinguishing between the di? erent types of social in? uence that are possible. The literature on social in? ence has emphasized that the underlying mechanism is nuanced and complex. Obviously, di? erent types of social in? uence relate and interact in ways that cannot be teased apart simply with di? erent wording. However, the variation in messages does allow us to study whether explicit advertising messages that attempt to use di? erent types of wording to evoke social in? uence are e? ective in general. Figure 1: Sample Ad Figure 1 displays an anonymized sample ad for a social ad in the ‘be like your friend’ condition. The blacked-out top of the ad contained the non-pro? t’s name. The grayedhere. out bottom of the ad contained a supporter’s name, who had ‘liked’ the charity and was a Facebook friend of the person who was being advertised to. It is only with developments in technology and the development of automated algorithms that such individualized display of the friend’s name when pertinent is possible. Table 3 describes the demographics of the roughly 1,500 fans at the beginning of the campaign. Though the initial fans were reasonably spread out across di? erent age cohorts, they were more female than the average population, which makes sense given the nature of the charity. At the end of the experiment, the fans were slightly more likely to be male than before. The way that Facebook reports data means that we have access to the demographics only of the fans of the charity, not of those who were advertised to. Table 3: Demographics of the non-pro? t’s fans before and after the ? eld experiment Age 18-24 25-34 35-44 45-54 55+ Total Before Male 5 5 6 3 3 22 Experiment After Experiment Female Male Female 13 8 14 14 6 14 17 6 16 13 3 13 10 4 10 67 27 67 The ‘Total’ row does not add up to 100% because fans who are below 18 years of age are omitted. 9 3 Data The data that Facebook shares with advertisers is both anonymous and aggregate. This means that we cannot trace the e? ects of social advertising on the friends of any one individual. It also means that we cannot examine heterogeneity in the degrees of in? uence across individuals, as is studied, for example, by Godes and Mayzlin (2009) in their study of o? ine ? rm-sponsored communications. However, given that the central research question of the study is whether, on average, di? erent types of social advertising are more e? ective, the aggregate nature of the data is su? cient. Table 4 reports daily summary statistics for the campaigns in our data. Over a 5-week period, there were 630 observations. There were 18 campaigns in total that consisted of a) The three baseline conditions that were demographically targeted to everyone, charity-lovers and education-supporters and used the baseline text, and b) The ? fteen social ad conditions that had all the ? ve di? erent types of text, and socially targeted separately to everyone, charity-lovers and education-supporters. Table A2 in the appendix provides a summary of these campaigns. Table 4: Summary Statistics Mean Std Dev Min Max Average Impressions 13815. 13898. 6 1 98037 Average Clicks 5. 06 5. 17 0 37 Connections 2. 70 3. 52 0 24 Unique Clicks 5. 04 5. 14 0 36 Daily Click Rate 0. 11 0. 10 0 1. 27 Impression Click Rate 0. 045 0. 047 0 0. 50 Cost Per Click (USD) 0. 98 0. 40 0. 31 3. 90 Cost Per 1000 views (USD) 0. 52 1. 37 0 24. 5 Ad-Reach 6165. 7 6185. 0 1 60981 Frequency 2. 32 0. 82 1 9. 70 18 ad variants at the daily level for 5 weeks (630 observations) There are two click-through rates reported in Table 4. The ? rst click-through rate is the proportion of people who clicked on an ad that day. The denominator here is the 10 Ad-Reach measure that captures the number of people exposed to an ad each day. The second click-through rate is per ad impression. We focus on the former in our econometric analysis, because impressions can be a function of person refreshing their page or using the back button on the browser or other actions which do not necessarily lead to increased exposure to the ad. We show robustness subsequently to using this click-through rate per impression measure. Due to the relatively small number of clicks, these click through rates are expressed as percentage points or sometimes as fractions of a percentage point. In our regression analysis we also use this scaling in order to make our coe? cients more easily readable. 2 The data also contains an alternative means of measuring advertising success. The connection rate measures the number of people who liked a Facebook page within 24 hours of seeing a sponsored ad, where the denominator is the ad’s reach that day. We compare this measure to clicks in subsequent analysis to check that the click-through rate is capturing something meaningful. We also use the cost data about how much the advertiser paid for each of these ads in a robustness check. The data reassuringly suggests that there were only ? ve occasions where someone clicked twice on the ads. Therefore, 99. 8% of the click-through rate we measure captures a single individual clicking on the ad. 2 11 Figure 2: Social advertising is e? ective 4 4. 1 Results Does Social Advertising Work? First, we present some simple evidence about whether social advertising is more e? ective than regular display advertising. Figure 2 displays the basic comparison of aggregate (that is, across the whole ? ve-week period) click-through rates between non-socially-targeted ads and ads that were socially targeted. Since these are aggregate click-through rates they di? er from the daily click-through rates reported in Table 4. These are expressed as fractions of a percentage point. It is clear that social advertising earned far larger click-through rates. The di? erence between the two bars is quite striking. To check the robustness and statistical signi? cance of this relationship, we turn to econometrics. The econometric analysis is relatively straightforward because of the randomization induced by the ? eld tests. We model the click-through rate of campaign j on day t targeted to demographic group k as: 2 ClickRatejt = ? SocialT argeting Endorsementj + ? k + ? t + j (1) SocialT argeting Endorsementj is an indicator for whether or not this campaign variance was socially targeted and displayed the endorsement. Since Facebook does not allow the testing of these di? erent features separately, this is a combined (rather than separable) indicator. ?k is a ? xed e? ect that captures whether this wa s the untargeted variant of the ad. This controls for underlying systematic di? erences in how likely people within that target and untargeted segment were to respond to this charity. We include a vector of date dummies ? t . Because the ads are randomized, ? t and ? k should primarily improve e? ciency. We estimate the speci? cation using ordinary least squares. Though we recognize that theoretically a click-through rate is bounded at one hundred since it is measured in percentage points, click-through rates in our data are never close to this upper bound or lower bound. 3 Table 5 reports our initial results. Column (1) presents results for the simple speci? cation implied by equation (1) but without the date and demographic controls. The point estimates suggest that social targeting and a friend’s endorsement increased the average daily clickthrough rate by around half. Column (2) repeats the analysis with the controls for date. It suggests that after controlling for date, the result holds. This is reassuring and suggests that any unevenness in how ads were served across days does not drive our results. It also suggests that our result is not an artifact of a failure of randomization. Column (3) adds an extra coe? cient that indicates whether that campaign was untargeted rather than being targeted to one of the customer groups identi? d as being likely ‘targets’ by the non-pro? t We also tried alternative speci? cations where we use the unbounded clicks measure (rather than a rate) as the dependent variable and show that our results are robust to such a speci? cation in Table A1, in the appendix. 3 13 – Educational and Charity supporters. It suggests that indeed, as expected, an untarge ted campaign was weakly ine? ective, though the estimate is not signi? cant at conventional levels. We speculate that the apparent weakness of demographic targeting may be because target markets of charity and educational supporters is reasonably broad, and consequently may have ontained many individuals who would not support an international charity. An obvious question is what explains the success of social advertising. One explanation is that the endorsement of a friend is informative. Another explanation is that social targeting uncovers people who will be more likely to be interested in their charity as they are similar, in unobserved ways, to their friends who are already fans of the charity. Manski (1993) pointed out that this particular issue of distinguishing homophily (unobserved characteristics that make friends behave in a similar way) from the explicit in? ence of friends on each other is empirically problematic. Ideally, to address this we would simply randomize whethe r users saw the endorsement or not. However, Facebook’s advertiser interface does not allow that. What we can do is take advantage of the fact that sometimes ads are shown to people without the endorsement if that fan has selected a privacy setting which restricts the use of their image and name. The interface which users use to do this is displayed in Figure A1; all users do is simply select the ‘No One’ rather than the ‘Only my friends’ option. Of course, this will not represent perfect randomization. It is likely that the fans who select stricter privacy settings di? er in unobserved ways from those who do not, and that therefore their social networks may di? er as well. However, despite this potential for bias, this does represent a useful opportunity to try to disentangle the power of social targeting to enable homophily and the power of personal endorsements. Column (4) displays the results of a speci? cation for equation (1) where the dependent variable is the conversion rate for these socially targeted but not socially endorsed ads. Here for ads that were being shown to friends, the click-through rate was only calculated for occasions when the endorsement was not shown. A comparison of Column 14 (3) and Column (4) in Table 5 makes it clear the ads that were displayed to friends of fans but lacked a clear endorsement were less e? ective than those that had a clear endorsement. However, they were still measurably more e? ective than non-socially-targeted ads. It appears that, roughly, the endorsement accounted for less than half of the persuasive e? ect and the ability to use social networks to target the ad accounted for slightly more than half of such ads’ e? acy. Columns (5) and (6) of Table 5 estimate the speci? cation separately by whether the campaign was targeted or untargeted. Though the point estimate for the targeted campaigns is higher, it is notable that social advertising improved the performance of both targeted and untargeted campaigns. Given the widely reported lack of e? cacy of untargeted campaigns (Reiley and Lewis, 2009), the increase in e? ectiveness allowed by social advertising appears large for untargeted campaigns. 15 Table 5: Social Targeting and Endorsement is E? ective (4) No Endorsement Click Rate SocialTargeting Endorsement All (1) Click Rate 0. 0386 (0. 0123) (2) Click Rate 0. 0385 (0. 0108) 0. 0287 (0. 0143) -0. 000275 (0. 0122) 0. 0794 (0. 0116) 0. 0132 (0. 0166) (3) Click Rate 0. 0386 (0. 0125) Untargeted (5) Click Rate 0. 0297 (0. 00755) Targeted (6) Click Rate 0. 0376 (0. 00927) SocialTargeting Untargeted Constant 16 Date Controls No Yes Yes Yes Yes Yes Observations 630 630 630 630 210 420 Log-Likelihood 542. 1 610. 3 610. 3 427. 8 187. 7 452. 3 R-Squared 0. 0221 0. 212 0. 212 0. 119 0. 317 0. 228 OLS Estimates. Dependent variable is the percentage point of people who click on the ad. Dependent variable in Columns (4) for social ads is the percentage point daily click-through rate of ads that did not display the endorsement. Robust standard errors. * p 0. 10, ** p 0. 05, *** p 0. 01 4. 2 Robustness Table 6 checks the robustness of the ? nding that social targeting and endorsement are effective, to di? erent de? nitions of the dependent variable. Column (1) reports the results of using a dependent measure which is the percentage click-through per impression. Again, we ? nd that social advertising is more e? ective, though the e? ectiveness is less pronounced and less precisely estimated than before. This suggests that the appeal of social advertising is not necessarily enhanced by multiple exposure. It could also, of course, merely re? ect noise introduced into the process by someone refreshing their browser multiple times. The results so far suggest that consumer privacy concerns or the intrusiveness of such ads do not seem to outweigh the appeal of social advertising for consumers. 4 There is always the possibility of course that people clicked on the ads because they were annoyed or wanted to understand more the extent of privacy intrusion rather than because the ads were actually e? ective. To explore this, we estimate a speci? cation where the dependent measure was the proportion of clicks that became subscribers of the newsfeed. The results are reported in Column (2). We see that again social advertising appears to be more e? ective at encouraging Facebook users to take the intended action as well as simply clicking. This is evidence that people are not clicking on social ads due to annoyance at their intrusiveness but instead are clicking on them and taking the action the ads intend to encourage them to take. Untargeted ads are less likely to lead to conversions than those targeted at appropriate demographics. This makes sense – these people are being targeted precisely because they are the kind of people who have signed up for such news feeds in the past. A ? nal question is whether ads that are socially targeted and display endorsements are more expensive for advertisers, thereby wiping out their relative e? ectiveness in terms of return on advertising investment. We explore this in Column (3) of Table 6. There are This may be because Facebook users ? nd it reassuring that these ads, though narrowly targeted, are not overly visually intrusive (Goldfarb and Tucker, 2011). 4 17 everal missing observations where there were no clicks that day and consequently there was no price recorded. In Column (3), we report the results of a speci? cation where our explanatory variables is the relative price per click. The results suggest that advertisers pay less for these clicks that are socially targeted. This suggests that Facebook is not charging a premium for this kind of advertising. Though Facebook shrouds in secrecy the precise pricing and auction mechanism underlying their advertising pricing, this result would be consistent with a mechanism whereby advertisers pay less for clicks if they have higher clickthrough rates. In other words, prices paid bene? t from an improved ‘quality-score’ (Athey and Nekipelov, 2011). The results also suggest that advertisers pay less for demographically untargeted clicks which is in line with previous studies such as Beales (2010). Table 6: Social Advertising is E? ective: Checking robustness to di? erent dependent variables SocialTargeting Endorsement (1) Click Rate (Multiple) 0. 0108 (0. 00501) 0. 00526 (0. 00582) Yes 630 1086. 5 0. 150 (2) Clicks to Connections Rate 0. 433 (0. 0997) -0. 321 (0. 0768) Yes 554 -467. 5 0. 163 (3) Cost Per Click (USD) -0. 95 (0. 0480) -0. 177 (0. 0520) Yes 559 -129. 0 0. 426 Untargeted Date Controls Observations Log-Likelihood R-Squared OLS Estimates. Dependent variable is the click-through rate (expressed as a fraction of a percentage point) for impressions in Column (1). Dependent variable in Column (2) is the clicks to conversions rate. Dependent variable in Column (3) is cost per click. Robust standard errors. * p 0. 10, ** p 0. 05, *** p 0. 01 4. 3 What Kind of Social Advertising Messages Work? We then go on to explore what kind of advertising message works in social ads. We distinguish between ads that rely simply on the Facebook algorithm to promote social in? uence by featuring the automated endorsement at the bottom of their ad, and ads that explicitly refer to this endorsement in their ad copy. 18 Table 7: Social Advertising is Less E? ective if an Advertiser is Too Explicit (3) No Endorsement Click Rate SocialTargeting Endorsement All (1) Click Rate 0. 0577 (0. 0139) (2) Click Rate 0. 0571 (0. 0113) 0. 0333 (0. 0168) -0. 0287 (0. 00886) -0. 000463 (0. 0122) -0. 0136 (0. 0115) -0. 0189? (0. 01000) -0. 0378 (0. 0115) -0. 0429 (0. 0144) -0. 101 (0. 0124) Yes 630 615. 4 0. 225 Yes 630 618. 1 0. 232 Yes 630 429. 5 0. 124 Yes 210 189. 6 0. 329 Yes 420 461. 0 0. 260 -0. 000281 (0. 0177) 0. 0161 (0. 0169) -0. 0303? (0. 0167) -0. 0284 (0. 0124) Untargeted (4) Click Rate 0. 0498 (0. 0245) Targeted (5) Click Rate 0. 0527 (0. 0130) SocialTargeting SocialTargeting Endorsement ? Explicit Untargeted SocialTargeting Endorsement ? Don’t be left out Social Targeting Endorsement ? Be like your friend SocialTargeting Endorsement ? Learn from your friend 19 SocialTargeting Endorsement ? Your friend knows SocialTargeting ? Explicit Date Controls Observations Log-Likelihood R-Squared OLS Estimates. Dependent variable is the percentage points of people who click on the ad. Dependent variable in Columns (3) adjusted for social ads so that is the percentage point daily click-through rate of ads that did not display the endorsement. Robust standard errors. * p 0. 10, ** p 0. 05, *** p 0. 01 We use the additional binary indicator variable Explicitj to indicate when the advertiser uses a message that evokes social in? uence explicitly in their ad copy, in addition to the social endorsement automated by the Facebook algorithm. This covers all the non-baseline conditions described in Table 2. We interact this with the SocialT argeting Endorsementj , meaning that SocialT argeting Endorsementj now measures the e? ect of the baseline effect, and the interacted variable measures the incremental advantage or disadvantage of mentioning the friend or the potential for social in? uence in the ad. Column (1) of Table 7 reports the results. The negative coe? cient on the interaction between Explicit and SocialT argeting Endorsementj suggests that explicit reference to a social in? uence mechanism in the ad a? ected the performance of the ad negatively. That is, when the advertiser themselves were explicit about their intention to harness social in? uence, it back? res. Further, the large point estimate for SocialT argeting Endorsementj suggests that the baseline message is even more e? ective than the estimates of Table 5 suggested. Column (2) in Table 7 reports the results of a speci? cation where we break up Explicit by the di? erent types of ‘social in? uence’-focused advertising messages featured in Table 2. It is striking that all measures are negative. It is also suggestive that the one message that was not statistically signi? ant and had a smaller point estimate than the others did not refer to the friend explicitly but instead referred obliquely to the friend’s action. This is speculative, since the point estimate here is not statistically di? erent from the others due to its large standard error. Column (3) repeats the exercise for the click-through rate for the ads that did not display an endorsement that we investigated in Table 5. Since these ads did not display the friend’s name at the bottom, it should not be so obvious to a viewer that the ? rm is explicitly trying to harness the social in? uence that results from the friend being a fan of the charity. We recognize that there may of course be some confusion at the mention of a friend when no name is displayed, but this confusion should work against us rather than for us. In this case, 20 we do not see a negative and signi? cant e? ect of the ‘Explicit’ advertising message which referred to a friend. This suggests that it was the combination of the friend’s name and the mention of social in? uence which was particularly o? -putting. The results in Column (3) suggest that what is damaging is the combination of an advertiser making it explicit they are trying to harness social in? ence and the algorithmic social advertising message. We next explored whether this ? nding that attempts by advertisers to explicitly harness social in? uence in their ad text damaged the e? ectiveness of social advertising di? ered by the target group selected. Column (4) presents the results for the campaign that was targeted at friends of fans who were simply over 18 years old and base d in the US. Column (5) presents the results for the group of users whom the charity selected as being in the target ‘demographic’ groups for the campaign – that is users whose Facebook pro? e revealed their support for other educational and charitable causes. What is striking is the similarity of the estimates for the e? cacy of social advertising and the damage done by the advertiser being overly explicit about social in? uence across Columns (4) and (5). Again, similar to the results reported in Table 5 social advertising appears to be able to o? er as nearly as large a lift to ad e? cacy for an untargeted population as a targeted one. 4. 4 Behavioral Mechanism We then collected additional data to help rule out alternative explanations of our ? nding that the explicit mention of social in? ence was undesirable in social ads. One obvious potential explanation is that what we are measuring is simply that people are unaware that what they are seeing is actually a n ad, rather than part of Facebook. When a non-pro? t uses a message such as ‘Be like your friend’ then it becomes obvious that this is an ad, and people respond di? erently. To test this, we persuaded the non-pro? t to run a subsequent experiment that allowed us to explicitly tease this apart. In this experiment we compared the performance of ads that said ‘Please read this ad. Help girls in East Africa 21 change their lives through education. , and ads that simply said ‘Help girls in East Africa change their lives through education. ’5 If it is was the case that Facebook users were simply mistaking socially targeted ads for regular content and the explicit appeals to social in? uence stopped them making this mistake, we would expect to also see a negative e? ect of wording that made it clear that the message was an ad. However, it appears that adding ‘Please read this ad’ if anything helped ad performance, which suggests that it was not the case that Facebook users were simply mistaking socially targeted ads for content if there is no explicit message. Obviously, though, the sample size here is very small, making more de? nitive pronouncements unwise. Table 8: Not Driven by Lack of Awareness of Advertising or Universally Unappealing Ad Copy Knowledge (1) Click Rate 0. 0312? (0. 0160) 0. 0114 (0. 0288) Fashion (2) Click Rate 0. 0194 (0. 0208) 0. 0376? (0. 0221) 0. 0449? (0. 0254) -0. 00448 (0. 0218) 0. 0172 (0. 0254) 0. 127 (0. 0584) (3) Click Rate 0. 0182 (0. 0208) SocialTargeting Endorsement SocialTargeting Endorsement ? Explicit SocialTargeting Endorsement ? Don’t be left out SocialTargeting Endorsement Be like your friend SocialTargeting Endorsement ? Learn from your friend SocialTargeting Endorsement ? Your friend knows Date Controls Yes Yes Yes Observations 20 60 60 Log-Likelihood 55. 43 91. 77 103. 7 R-Squared 0. 916 0. 267 0. 508 OLS Estimates. Dependent variable is the percentage point of people who click on ad that day. Robust standard errors. * p 0. 10, ** p 0. 05, *** p 0. 01 Recent research has questioned the use of the imperative in advertising copy, which is why we used ‘please’ (Kronrod et al. , 2012) 5 22 Another alternative explanation for our ? dings is that the messages referring to the friend were poorly-written or unappealing. To test whether this was the case, we selected an alternative set of users whom might be expected to react in an opposite way to potential presumptions of social in? uence. Speci? cally, the charity agreed to run test conditions identical to those in Table 2 for the people who expressed a? nity with ‘Fashion’ goods on their Facebook pro? les. The Fashion category of users were chosen because typical models of social in? uence have focused on fashion cycles (Bikhchandani et al. , 1992). These models emphasize the extent to which people who participate in Fashion cycles receive explicit utility from conformity, even when this conformity is provoked by a ? rm. In other words, they may ? nd advertiser-endorsed social in? uence more persuasive and advertiser attempts at emphasizing the power of social in? uence more acceptable than the general population does. This group of users exhibits a very di? erent pattern to that exhibited by the general population. They appear to respond somewhat positively to social advertising, though this estimate is imprecise and the point estimate is smaller than for the other conditions. However, strikingly, they reacted particularly positively to advertising messages that emphasized social in? uence and the actions of the friend in the ad copy. In other words, social advertising for this group worked even when the advertiser explicitly embraced the potential for social in? uence. This result suggests that there may be heterogeneity in consumer responses to the wording of social advertising messages depending on their previous consumption patterns. This is evidence against an alternative explanation for our results in Table 7 based on these advertising messages which explicitly refer to the potential for social in? ence being confusing or overly wordy, since they were e? ective for this group of Fashion fans. In general, the results of Tables 7 and 8 suggest that there is heterogeneity in distaste for advertiser attempts to harness social in? uence given previous consumption patterns, but that for the average person the e? ects are negative. 23 5 Implications How hel pful is data on social relationships when it comes to targeting and delivering advertising content? This paper answers this question using ? eld test data of di? erent ads on the large social network site Facebook. We ? nd evidence that social advertising is indeed very e? ctive. This is important, as for the past few years social network websites have often been dismissed by advertisers as venues for ‘paid media’, that is, paid advertising. Instead, the emphasis was on ‘earned’ or organic media whereby social networks were venues for organic word of mouth. This dismissal of paid advertisements was echoed in the popular and marketing press with headlines such as ‘Online Social Network and Advertising Don’t Mix’ and ‘Facebook Ad Click-Through Rates Are Really Pitiful’ (Joel, 2008; Barefoot and Szabo, 2008). Our results suggest, however, that as social advertising develops this will change swiftly. In particular, social networks will be able to exploit their considerable inherent network e? ects to enlarge their share of advertising dollars. Strikingly, we ? nd that the average Facebook user appears to ? nd social advertising as done by the standard Facebook algorithm appealing. However, when advertisers attempt to emulate or reinforce this social in? uence, consumers appear less likely to respond positively to the ad. Speculatively, the results suggest that intrusive or highly personal advertising is more acceptable if done algorithmically by a faceless entity uch as a computer than when it is the result of evident human agency. Very speculatively, there is perhaps a parallel with users of web-based email programs accepting an algorithm scanning their emails to serve them relevant ads when the interception of emails by a human agent would not be acceptable. Our results suggest that social advertising works well for both targeted and untargeted populations, which may mean that social advertising is a particularly useful technique when 24 advertising to consumers outside the product’s natural or obvious market segment since their are less obvious ways of targeting in these settings. The majority of this e? cacy appears to be because social targeting uncovers unobserved homophily between users of a website and their underlying receptiveness to an advertising message. There are of course limitations to our study. First, the non-pro? t setting may bias our results in ways that we cannot predict. Second, the aims of the non-pro? t also means the outcome measure we study is whether or not people sign up to hear more about the nonpro? t, rather than studying the direct e? ect of advertising on for-pro? t outcomes such as customers making purchases. Third, we studied this advertising at a time when Facebook was just launching and promoting its social advertising features. It is not clear whether the results will be as strong if the advertising market becomes saturated with social ads. Notwithstanding these limitations, we believe that this paper makes a useful contribution in terms of documenting when social advertising is useful and when it is not. 25 References Algesheimer, R. , S. Borle, U. M. Dholakia, and S. S. Singh (July/August 2010). The impact of customer community participation on customer behaviors: An empirical investigation. Marketing Science 29 (4), 756–769. Aral, S. and D. Walker (September 2011). Creating social contagion through viral product design: A randomized trial of peer in? uence in networks. Management Science 57 (9), 1623–1639. Athey, S. and D. Nekipelov (2011). A structural model of sponsored search advertising auctions. Mimeo, Berkeley. Bagherjeiran, A. , R. P. Bhatt, R. Parekh, and V. Chaoji (2010). Online advertising in social networks. In B. Furht (Ed. ), Handbook of Social Network Technologies and Applications, pp. 651–689. Springer US. Bakshy, E. , J. M. Hofman, W. A. Mason, and D. J. Watts (2011). Everyone’s an in? encer: quantifying in? uence on Twitter. In Proceedings of the fourth ACM international conference on Web search and data mining, WSDM ’11, New York, NY, USA, pp. 65–74. ACM. Barefoot, D. and J. Szabo (2008, April). Facebook ad click-through rates are really pitiful. Friends with Bene? ts: A social media handbook blog. Beales, H. ( 2010). The value of behavioral targeting. Mimeo, George Washington University. Bikhchandani, S. , D. Hirshleifer, and I. Welch (1992, October). A theory of fads, fashion, custom, and cultural change in informational cascades. Journal of Political Economy 100 (5), 992–1026. 6 Burnkrant, R. E. and A. Cousineau (1975, December). Informational and normative social in? uence in buyer behavior. Journal of Consumer Research 2 (3), 206–15. ComScore (2011). ComScore’s 2011 social report: Facebook leading, microblogging growing, world connecting. White Paper . Corcoran, S. (2009, December 16). De? ning earned, owned and paid media. Forrester Research. Deutsch, M. and H. B. Gerard (1955). A study of normative and informational social in? uences upon individual judgment. The Journal of Abnormal and Social Psychology 51 (3), 629–636. Facebook (2010, September). A/B testing your Facebook ads: Getting better results through experimentation’. Technical Report. Godes, D. and D. Mayzlin (2009). Firm-Created Word-of-Mouth Communication: Evidence from a Field Test. Marketing Science 28 (4), 721–739. Goldfarb, A. and C. Tucker (2011, May). Online display advertising: Targeting and obtrusiveness. Marketing Science 30, 389–404. Gossieaux, F. and E. Moran (2010). The Hyper-Social Organization: Eclipse Your Competition by Leveraging Social Media. McGraw-Hill. Hill, S. , F. Provest, and C. Volinksky (2006). 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Endorsement A-1 Table A1: Robustness of Table 5 to using number of clicks as dependent variable OLS (1) Average Clicks SocialTargeting Endorsement 1. 991 (0. 394) -0. 0385 (0. 422) 0. 000405 (0. 0000443) Poisson (2) Average Clicks 0. 258 (0. 0746) 0. 134 (0. 0817) 0. 0000327 (0. 00000638) Negative Binomial (3) Average Clicks 0. 230 (0. 0922) 0. 187 (0. 123) 0. 0000455 (0. 0000135) Untargeted Ad-Reach Date Controls Yes Yes Yes Observations 630 630 630 Log-Likelihood -1484. 8 -1417. 6 -1394. 7 R-Squared 0. 755 OLS Estimates in Columns (1)-(2). Dependent variable is the Number of clicks on the ad in Columns (3)-(4). Robust standard errors. * p 0. 10, ** p 0. 05, *** p 0. 01 A-2 Table A2: Summary of 18 Campaigns Campaign 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Social Ad? Social Advertising Social Advertising Social Advertising Social Advertising Social Advertising Social Advertising Social Advertising Social Advertising Social Advertising Social Advertising Social Advertising Social Advertising Social Advertising Social Advertising Social Advertising Non-Social Advertising Non-Social Advertising Non-Social Advertising Demo Targeting? Demo 1 Targeted Demo 1 Targeted Demo 1 Targeted Demo 1 Targeted Demo 1 Targeted Demo 2 Targeted Demo 2 Targeted Demo 2 Targeted Demo 2 Targeted Demo 2 Targeted Untargeted Untargeted Untargeted Untargeted Untargeted Demo 1 Targeted Demo 2 Targeted Untargeted Message Baseline Message 1 Message 2 Message 3 Message 4 Baseline Message 1 Message 2 Message 3 Message 4 Baseline Message 1 Message 2 Message 3 Message 4 Baseline Baseline Baseline A-3 How to cite Key Success Factors for Online Advertising, Essay examples

Principles of Governance System Distinguish

Question: Discuss about the Principles of Governance System Distinguish. Answer: Introduction: In deciding on the form of government, consideration needs to be given on the aim of the government and the relevant system in existence at the time. As the British government was the most well-known system, hence, essentially government systems have been described in relation of the same. The aim of the current paper is to describe the government that was envisaged by Paine and Adams for the thirteen colonies or the United States As per Thomas Paine, the end purpose of the government is to offer freedom and security to the inhabitants. Further, he draws inspiration from nature and highlights that the government structure should be simple as the more simple a thing is, the more likely it would be ordered. This is possible since it is easier to diagnose issues and rectify the same at the earliest. He offers the example of an absolute government which despite having other shortcomings ensures that government is simple since one person is at the helm of affairs and this makes it easier to identify and rectify potential issues. However, the government highlighted by the British Constitution is exceedingly complex as a result of which it becomes exceedingly difficult to understand the source of a given problem. Hence, Paine recommended a new form of government which should not be too complex like the British system. It should draw only limited inspiration from the British Constitution due to inherent contradictions . It should not be based on the rule of the hereditary king. For Adams, the foundation of the new government should not be fear but virtues. This is because any government based on sound societal virtues would ensure maximum happiness for maximum people of the society. The law making mechanism is critical for the new government. It is imperative that the power to make laws should be vested in some representatives. This representative assembly should be to the extent possible a miniature version of the society and must reflect the core beliefs. This could be brought about by an election system which is fair and impartial. However, all the powers (legislative, judiciary and executive) should not be yielded to a single representative assembly. This is because the assembly needs to be controlled or it may grow ambitious and corrupt. Besides, it may lack the requisite abilities to act as the executive and judiciary also besides carrying on with the legislative powers. Also, such an assembly may be self-serving and thus in course of time would stop serving the society as a whole. Conclusion: The executive and legislative powers should be vested in different arms and there needs to be a separate assembly (called council) with some executive powers which can serve as a mediator between the two. This should be chosen from amongst the elected members but should function independently. Further, the legislature as a whole must elect a governor to head the council through joint ballot system. Also, the elections of representatives and counsellors should be carried out on an annual basis. This is imperative to ensure that the accountability remains. The legislature should be provided with the requisite flexibility to fix the tenure of the governor as it deems necessary for the welfare of the society. Also, a privy council should be constituted consisting of five to seven members belonging to the legislature so as to provide advice to the governor. Additionally, rotation of offices should also be encouraged if feasible. The governor would be the supreme commander of all armed for ces and would have the pardoning power. Further, the various officers belonging to civil, military or judicial sphere have to be appointed and nominated by governor acting with the consent of the council. Further, the judiciary should be independent of the other two arms i.e. legislature and executive. Besides, the judges could be impeached for inappropriate conduct by the House of Representatives. Hence, based on the above, it is fair to conclude that current model of governance prevalent in the US owes strongly to the principles outlined by Adams and Paine and hence led to the paving of a governance system distinguish from the British governance system.