The impact of multi-type online advertising on the consumer engagement transition

The explosion in the volume and variety of online advertising has contributed to constantly changing consumer engagement states by influencing their experience through the journey to purchase. In this paper, we use a latent Markov model to analyze the panel data from a large e-commerce firm, so as to explore changes in the engagement behavior and the latent engagement state transition of consumers under different advertising. Contrary to common belief, advertising does not always play an active role in communicating with consumers. Our findings show that the response of consumers to advertising is heterogeneous at different engagement levels, and this heterogeneity will be affected by the type of advertising and the number of different advertisements consumers contact. We explore the underlying reasons for the two-sided impact of advertising on consumer engagement, and thus expected to provide managerial insights for marketers who pay attention to consumer experience.

Automated summary

This paper uses a latent Markov model to analyze panel data from a large e-commerce firm and investigate changes in consumer engagement behavior and latent engagement state transition under different types of advertising. The findings reveal heterogeneous responses of consumers to advertising at different levels of engagement, which are influenced by the type and number of advertisements consumers are exposed to.