Marketing Seminar（2018-26）

Topic: Group Search Strategy

Speaker: Xinyu Cao,NYU Stern School of Business

Time: Wednesday, 19 December, 13:30-15:00

Location: Room 217, Guanghua Building 2

Abstract:

It is prevalent in the real life that a group of people need to search and make a group decision, such as when a family search and purchase a house. Since group members may have different preferences, it can be harder for group search to come to a decision. Thus, the group search strategy may differ from single-agent search strategy. Specifically, though it is widely believed that sequential search strategy dominates fixed-sample search strategy for single-agent search, this may not be true for group search. In this paper, we model group search under fixed-sample strategy and sequential strategy, and we show that when the search cost (relative to the dispersion of the value distribution) is very small or large enough, fixed-sample strategy is better than sequential strategy. This reflects a trade-off between the information advantage of sequential strategy and the commitment advantage of fixed-sample strategy. Due to the divergence of preferences in group search, the information advantage of sequential strategy is reduced, whereas the commitment advantage of fixed-sample strategy becomes more salient, especially when the search cost is very small or large enough. We further show that our result is robust to a change in distribution assumption or in the group size.

Introduction:

Prof. Xinyu Cao is Assistant Professor of Marketing at NYU Stern School of Business. Professor Cao’s research focuses on quantitative marketing with emphasis on market research methodology, online advertising, digital marketing and emerging markets. Her research methods combine game-theoretic models with field experiments or structural modeling. She teaches Introduction to Marketing at NYU Stern. Prior to joining NYU, she received her PhD in Marketing from MIT Sloan School of Management, her MS in Industrial Engineering and Operations Research from the University of California Berkeley, and her BS in Mathematics and Physics from Tsinghua University.

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