Social media effects on multi-generational diffusion of information technology products

This paper proposes a multi-generational model that captures the pre- and post-launch effects of social media on product diffusion. Post-launch effects appear in the adoption rate function as covariates, and pre-launch effects are embedded in hierarchical models as diffusion parameters that are connected to successive generations. The model reveals how social media accelerates and decelerates the diffusion of multi-generation products in the pre-launch and post-launch phases. Unlike previous multi-generational diffusion models, this model forecasts sales of new-generation products before launch. We employ the latent topics in social media as social media valence, and the empirical results show that the social media effects accelerate sales in the pre-launch period, and their effects decrease with varying patterns in the post-launch period.