The lmpact of Concealing the VIP Label on Hybrid Premium Model: Evidence from a Large-Scale Field Experiment

Workshop’s Topic: This study raises a critical question: How does the absence of these VIP labels affect user conversion on freemium platforms? In collaboration with a globally recognized photo editing platform, we conducted a large-scale randomized field experiment. Our results show that removing the VIP label can increase user conversion rate by 7.5 percent without significant negative effects such as a decrease in automatic billing, an increase in refund requests or a decrease in long-term user retention. Tests of the mechanism show that removing the VIP label encourages users to explore more features, which in turn increases the likelihood of conversion. Furthermore, the effect of VIP label removal varies across countries, with different cultural uncertainty avoidance levels and regions with different GDP per capita, underpinning the differentiation and exclusivity effects of VIP labels.

Time and Location: 10:00-11:30 AM (GMT+8), Room A723 (School of Management)

Language: Bilingual (Chinese and English)