Getting on the Map: The Impact of Online Listings on Business Performance / Michael Luca, Abhishek Nagaraj, Gauri Subramani.

Format:

Book

Author/Creator:

Luca, Michael.

Contributor:

National Bureau of Economic Research.

Nagaraj, Abhishek.

Subramani, Gauri.

Series:

Working Paper Series (National Bureau of Economic Research) no. w30810.

NBER working paper series no. w30810

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2022.

Summary:

We evaluate the extent to which small businesses maintain an online presence, looking at restaurant listings on a major online review platform. While the majority of restaurants have an online presence, we find that roughly 18 percent in our sample have no presence as of the end of 2017, despite being able to list their business for free. Using temporal variation in a restaurant's online presence as well as a natural experiment arising from a data acquisition that led over a thousand businesses to be added to the platform, we find that maintaining an online presence is valuable for small businesses. Establishing an online presence leads to a 5% revenue increase. Using data on customer reviews post-add, we explore potential channels that could explain why restaurants continue to remain offline despite potential benefits from digital representation. Consistent with models of voluntary disclosure, we find that businesses that had stayed offline until the acquisition ended up having lower ratings, on average, than those that added themselves or were added by customers.

Notes:

Print version record

December 2022.