The double-edged impact of social media on online trading: Opportunities, threats, and recommendations for organizations

Bizzi, Lorenzo and Labban, Alice,(2019), The double-edged impact of social media on online trading: Opportunities, threats, and recommendations for organizations. , Business Horizons, UNSPECIFIED

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Abstract

While we understand well how social media channels sway consumers, there is little understanding of their influence on online trading behavior. We argue that social media are creating a new class of self-directed online traders by simultaneously encouraging and biasing trading decisions. Through an empirical study, we show that heavy social media users are more likely to engage in online trading but are largely affected by online herding behavior, and are four times more likely to blindly follow other traders. Bloggers, influencers, social network contacts, and social media news shape these users’ online trading behaviors. As online traders influenced by social media are unlikely to receive adequate returns, companies face an ethical dilemma: They could leverage social media to efficiently access funds but they risk inappropriately exploiting the inexperience of online traders biased by social media. We offer a set of nine practical recommendations for organizations to respond to these new challenges
Keywords : Social media; Online trading; Social networks; Blogging; Cryptocurrencies, UNSPECIFIED
Journal or Publication Title: Business Horizons
Volume: 62
Number: 4
Item Type: Article
Subjects: Manajemen
Depositing User: Endhar Priyo Utomo
Date Deposited: 26 Dec 2019 05:47
Last Modified: 26 Dec 2019 05:47
URI: https://repofeb.undip.ac.id/id/eprint/833

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