The Value of Customer-Related Information on Service Platforms: Evidence From a Large Field Experiment

49 Pages Posted: 2 Mar 2020 Last revised: 18 Dec 2020

See all articles by Hengchen Dai

Hengchen Dai

University of California, Los Angeles (UCLA) - Anderson School of Management

Zhiyu Zeng

Tsinghua University - Department of Industrial Engineering

Dennis Zhang

Washington University in St. Louis - John M. Olin Business School

Zuo-Jun Max Shen

University of California, Berkeley - Department of Industrial Engineering & Operations Research (IEOR)

Zhiwei Xu

affiliation not provided to SSRN

Date Written: December 16, 2020

Abstract

As digitization enables service platforms to access users' information, important questions arise about how digital service platforms should disseminate information to improve platform operations. We contribute to this understanding by examining how providing customer-related information at the beginning of a service encounter affects service capacity and enjoyment. We evaluate this strategy via a field experiment on a live-streaming platform that connects hundreds of millions of individual broadcasters and viewers. When viewers entered shows, we provided viewer-related information to broadcasters who were randomly assigned to the treatment condition (but not to control broadcasters). Our analysis, involving a subsample of 49,998 broadcasters, demonstrates that relative to control broadcasters, treatment broadcasters expanded service capacity by 12.62% by increasing both show frequency (3.31%) and show length (7.10%), thus earning 10.44% more based on our conservative estimate. Moreover, our intervention increased service enjoyment (measured by viewer watch time) by 4.51%. Two surveys and additional analyses provide evidence for two mechanisms: (1) information about viewers presented shortly after their entry enables personalized greetings and facilitates social interaction, which addresses both viewers' and broadcasters’ needs for affiliation and satisfies viewers' preference for personalized treatment; (2) broadcasters receiving viewer-related information have a more vivid depiction of viewers and thus feel that their service is more appreciated and meaningful, which addresses broadcasters’ needs for competence. We also rule out several alternative explanations. Our low-cost, information-based intervention has important implications for digital service platforms that have little control over service providers’ work schedules and service quality.

Keywords: Platform Operations, Service Operations, Information Design, Field Experiment, Empirical OM

Suggested Citation

Dai, Hengchen and Zeng, Zhiyu and Zhang, Dennis and Shen, Zuo-Jun Max and Xu, Zhiwei, The Value of Customer-Related Information on Service Platforms: Evidence From a Large Field Experiment (December 16, 2020). Available at SSRN: https://ssrn.com/abstract=3528619 or http://dx.doi.org/10.2139/ssrn.3528619

Hengchen Dai (Contact Author)

University of California, Los Angeles (UCLA) - Anderson School of Management ( email )

110 Westwood Plaza
Los Angeles, CA 90095-1481
United States

Zhiyu Zeng

Tsinghua University - Department of Industrial Engineering ( email )

Beijing
China

Dennis Zhang

Washington University in St. Louis - John M. Olin Business School ( email )

One Brookings Drive
Campus Box 1133
St. Louis, MO 63130-4899
United States

Zuo-Jun Max Shen

University of California, Berkeley - Department of Industrial Engineering & Operations Research (IEOR) ( email )

IEOR Department
4135 Etcheverry Hall
Berkeley, CA 94720
United States

Zhiwei Xu

affiliation not provided to SSRN

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