Peer Effects in Influencer-Sponsored Content Creation on
Social Media Platforms
Prof. Qi Sun
Professor of Marketing,
College of Business, Shanghai University of Finance and Economics
Date: 9 April 2025 (Wednesday)
Time: 10:30 to 12:00
Venue: E22-G004
Host: Prof. Esther Qianqian LIU, Assistant Professor in Marketing
Abstract
To specify the peer effects that affect influencers’ sponsored content strategies, the current research addresses three questions: how influencers respond to peers, what mechanisms drive these effects, and the implications for social media platforms. By using a linear-in-means model and data from a leading Chinese social media platform, the authors address the issues of endogenous peer group formation, correlated unobservables, and simultaneity in decision-making and thereby offer evidence of strong peer effects on the quantity of sponsored content but not its quality. These effects are driven by two mechanisms: a social learning motive, such that following influencers emulate leading influencers, and a competition motive among following influencers within peer groups. No evidence of competition motive among leading influencers or defensive strategies by leading influencers arises. Moreover, peer effects increase influencers’ spending on in-feed advertising services, leading to greater platform revenues, without affecting the pricing of sponsored content. This dynamic may reduce influencers’ profitability, because their rising costs are not offset by higher prices. These findings emphasize the need for balanced strategies that prioritize both platform growth and influencer sustainability. By revealing how peer effects influence competition and revenue generation, this study provides valuable insights for optimizing content volume, quality, and financial outcomes for social media platforms and influencers.
Speaker
Prof. Qi Sun (孙琦) is Professor of Marketing at College of Business, Shanghai University of Finance and Economics. His research is focused on the quantitative analysis of firm strategy and consumer decisions. His research has appeared in top marketing and management journals including Management Science, Journal of Marketing Research, and Journal of Marketing.
All are welcome!
