Social networks and new product choice

Timothy Richards, Stephen F. Hamilton, William J. Allender

Research output: Contribution to journalArticlepeer-review

24 Scopus citations


To successfully market new products in a social network it is essential to identify influential individuals whose product recommendations influence the consumption choices of their peers. In this study, we use spatial econometric methods to determine how individuals revise their preferences for product attributes when exposed to product recommendations from peers, and how different individuals who vary in their degree of network connectedness exert influence on the product choices of others. We find evidence that consumers look to others for guidance from peers in their preference for subjective, taste-specific parameters, but tend not to respond to peer price choices. Our spatial methods allow us to empirically determine the influence exerted by individual members on the consumption choices of other members of the social network. We find that connected members of the social network are not always the most influential in revising the consumption choices of others. Our estimates reveal that network proximity explains only 8.8% of influence.

Original languageEnglish (US)
Pages (from-to)489-516
Number of pages28
JournalAmerican Journal of Agricultural Economics
Issue number2
StatePublished - Mar 2014


  • Choice-based conjoint
  • experimental economics
  • new product introduction
  • social network analysis
  • spatial econometrics

ASJC Scopus subject areas

  • Agricultural and Biological Sciences (miscellaneous)
  • Economics and Econometrics


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