"Maximizing Customer Equity by Taking Advantage of Customer Network Effects: A Theoretical Study with Simulation of Markets Using Java and Repast"
Jeremy DeGroot 2006
Abstract
This paper explores the relationship between the value extracted from customers by firms and the participation of those customers in social networks. By building on existing theory of customer value and introducing techniques from computer science and mathematics, the author creates a model that can be used to evaluate marketing actions by firms that face demand influenced by social networks. The model is tested and further explored through experiments that explore how firms can best take advantage of different network situations.