An empirical analysis of semantic network in online crowdfunding: Evidence from Kickstarter

Abstract

Crowdfunding, which helps getting financial sources for niche market entrepreneurs, lowers the entry barrier to start a social and for-profit project. However, it is widely believed that overwhelmingly successful projects, called "blockbuster" projects, would have a significant impact on the overall crowdfunding projects. In theoretical perspectives, there have been two countervailing effects of blockbuster, cannibalization effects and spill-over effects. Therefore, this motivates our research to investigate the competitions among projects within same categories. We expect to fill in the gaps of prior literatures which concluded that the blockbuster project has the same effects on all the other projects within same categories. As a major contribution of this paper, we obtain market structure insights from the creator generated contents based on a text-mining approach and combine it with semantic network analysis to assess the degree to which the latent competition causes cannibalize or spill-over effects inside the same category. Our study uses unique data set, compiled by Python based self-developed crawler. The dataset includes 148,398 projects and 2,915,821 records of daily pledged amount. Our analysis of the concurrent impact of blockbuster project shows the much larger spillover effects to the inside cluster relative to the outside clusters. However, this spillover effect to the outside cluster significantly increase as the magnitude to the inside cluster in the long run perspective. The results of this paper suggest practical marketing implications to entrepreneurs and platform.