Link loyalty in social networks: an econometric analysis of marketing channel networks in India

Marketing channel is a network of many intermediaries. When it comes to India, they have a lot of mutual interactions compared to what is witnessed in other parts of the world. They are both organised and unorganised structures, but the most interesting feature is that they are largely self-organised. Looking at this from a social network analysis perspective, there has to be some utility base for any link to be formed. In such networks, it is evident that the dealer or retailer expects to link with another for trade. Though profit is the basis, in reality, it is not only the gain, but also various other factors govern the link formation. An attempt is made in this paper to model the link formation based on factors such as commercial, social, trust and information dissemination. An econometric model using the ordered logistic regression is used to estimate the link formation. The econometric results show that players have strong loyalty towards links in terms of social, trust and information factors in the network.