Social Virtual World Continuance among Teens: Uncovering the Moderating Role of Perceived Aggregate Network Exposure

Transcription

1 Social Virtual World Continuance among Teens: Uncovering the Moderating Role of Perceived Aggregate Network Exposure Matti Mäntymäki A.K.M. Najmul Islam Turku School of Economics, University of Turku, Finland Abstract Engagement in virtual worlds has become pervasive, particularly among the young. At the same time, the number of virtual environments has increased rapidly. Due to intensifying competition, promoting sustained usage, i.e. continuance, has become a top priority for virtual world operators. Prior research has shown that network externalities play a key role in the adoption of communication technologies. However, a small amount of research has examined the role of network externalities in continued IT usage in general or with respect to virtual world participation in particular. To fill in this gap, we examine how perceived network externalities affect the continuance of social virtual worlds. To this end, we introduce the concept of perceived aggregate network exposure (PANE). We extend the original IS Continuance Model with perceived enjoyment and position PANE as a moderator. We test the model with data collected from 2,134 Finnish Habbo Hotel users and employ structural equation modeling in the analysis. The results demonstrate that PANE moderates the influence of motivational factors on continued use intention and satisfaction. Keywords: IS continuance, social virtual worlds, virtual worlds, network externalities, network effect 1

2 1. Introduction With 1.4 billion registered users globally, social virtual worlds (SVWs) such as Second Life and Habbo Hotel have become prominent venues for online social interaction and communication(kzero 2012). SWVs are defined as persistent computer-mediated 3D environments, designed for social interaction and entertainment, where the users are represented as avatars (Bell 2008; Mäntymäki and Salo 2011). The value of SVWs is essentially dependent on the presence and activities of other users and the accruing network externalities, i.e. the utility that a user derives from consumption of a good increases with the number of other agents consuming the good (Katz and Shapiro 1985, p. 424). This implies that retaining existing users as well as attracting new users is key managerial challenges for SVW service providers. To this end, prior information systems (IS) literature has examined continued IT usage, often referred to as IS continuance (Bhattacherjee 2001b) in a number of settings including online communities (Xiao-Ling Jin et al. 2010; Zhou 2011), social networking sites (Zhou et al. 2012) and SVWs (Barnes 2011; Jung 2011; Goel et al. 2011). However, with a few exceptions (Mäntymäki and Salo 2011; Mäntymäki and Salo 2013) prior virtual world research focusing on the role of network effects in usage behaviour has remained scant. Moreover, although other users have been found to influence individuals decisions on technology adoption via various mechanisms, such as network externalities (Katz and Shapiro 1985; Valente 1995), critical mass (Markus 1987; Van Slyke 2007), other adopters visible usage (Moore and Benbasat 1991) and perceived network externality (Lin and Bhattacherjee 2008), IS continuance literature has paid surprisingly little attention to the potential role and nature of network externalities. In particular, prior research has not examined how network externalities affect the relationships between beliefs, satisfaction and continuance intentions. Investigating this issue is important for the operators of social networking platforms such as SVWs since the size of a network does not mechanistically increase the users satisfaction with a service, or its perceived value. For example, the presence of other users 2

3 may not play such a central role when the user is interested in features that do not require the presence of other users. Additionally, the presence of other users can be embedded in the cognitive processes (e.g. setting the expectations) that lead to continued usage. This aligns with recent research on continued IT usage, which has found that the relationships between expectations, performance and usage behaviour can be more complex than stated in current theory (Brown et al. 2012) To address this gap, we empirically examine the role of perceived network effects in continued SVW use. For this purpose, we adopt the concept of perceived aggregate network exposure (PANE) introduced by Mäntymäki & Salo (2011). While their discussion of the exact nature of PANE was somewhat limited, we draw on prior literature to theoretically develop the PANE construct and address its similarities and differences with its originating constructs. Second, from empirical standpoint, Mäntymäki & Salo (2011) originally employed PANE as an antecedent in their TAM-based model. In this study, we empirically show that rather than an antecedent, PANE is a moderator. To this end, we use the expectation-confirmation theory (ECT) based IS continuance model (Bhattacherjee 2001b) as the theoretical framework of the study. To accommodate the characteristics of the SVW use context, we complement the IS continuance model with perceived enjoyment and we position PANE as a moderator. The model is tested with data collected from 2,134 Finnish Habbo Hotel users and to do that we employ structural equation modeling. As a result, we contribute to the research on user participation in virtual worlds (Goel et al. 2011; Jung 2011; Barnes 2011; Mäntymäki and Salo 2011) and the research on continued IT use (Bhattacherjee and Premkumar 2004; Kim and Malhotra 2005; Premkumar and Bhattacherjee 2008; Kim and Son 2009; Limayem and Cheung 2011). The paper is structured as follows: after the introduction, the IS continuance model is presented and that is followed with a review of the literature on network externalities in technology adoption. In section 3, the research model and hypotheses are presented. Section 4 presents the empirical research. In section 5, we conclude by discussing the theoretical and managerial implications of the study as well as unveiling the key limitations and areas for future inquiry. 3

4 2. Theoretical background 2.1. IS continuance The term continuance was originally coined to address the distinction between initial adoption decision, i.e. acceptance and continued usage (Bhattacherjee 2001b). The IS continuance model was developed from the ECT by Bhattacherjee (2001b) and has thereafter gained prominence in explaining continued IT usage in a wide range of settings (Thong et al. 2006; Larsen et al. 2009; Kang et al. 2009). The foundation of the IS continuance model, the ECT has been extensively used to explain consumers satisfaction and repurchase decisions in a variety of post-purchase contexts (Oliver 1980; Churchill and Surprenant 1982; Bhattacherjee 2001b) The ECT posits that a consumer s level of satisfaction with a product or service determines his/her re-purchase intention. The consumer s level of satisfaction with the product or service is determined by the consumer s initial expectations (pre-purchase expectations) of a product or service, and discrepancies between expectations and product or service performance (disconfirmation). Even before the purchase decision, a consumer develops expectations about the product or service. After the purchase has been made, the consumer gains experience from using the product/service and then develops perceptions about its performance. This leads to the consumer either confirming or disconfirming the pre-purchase expectations, after assessing perceived performance against the earlier frame of reference. The consumer s expectations are confirmed when the product/service performs as expected; negatively disconfirmed when it performs worse than expected; and positively disconfirmed when it performs better than expected (Churchill and Surprenant 1982). Adapted from ECT, the IS continuance model asserts that users continued IS usage decision is similar to customers repurchase decisions because both decisions follow an initial acceptance or purchase decision, are influenced by the initial use and experience of an IS or product, and can potentially lead to ex post reversal of the initial decision (Bhattacherjee 2001b). 4

5 The IS continuance model addressed the distinction between initial acceptance and continued usage. Consequently, the IS continuance model posits that users after the initial acceptance and a period of initial use will form an opinion on whether their preacceptance expectations are confirmed or disconfirmed (confirmation). Based on this confirmation, the users will form an opinion about the benefits (perceived usefulness). After a period of time, both confirmation and perceived usefulness will form the basis of users satisfaction with the IS (satisfaction). Finally, perceived usefulness and satisfaction will impact on users willingness to continue using the IS (continuance intention) (Bhattacherjee 2001a; Bhattacherjee 2001b). Several extensions have been proposed to the original IS continuance model since its introduction (Thong et al. 2006; Limayem et al. 2007; Larsen et al. 2009; Chang and Zhu 2012). Perceived ease of use and perceived enjoyment are the most commonly used variables that have been used to extend the IS continuance model (Islam 2012). Perceived enjoyment is considered an important factor in shaping users IS continuance intention with hedonic systems (Thong et al. 2006) SVWs offer a wide range of content and features such as in-world games, events and contests to fulfil the users hedonic needs. Hence, we employ the IS continuance model with perceived enjoyment (Thong et al. 2006) Moreover, given the nature of SVWs as hedonic and social IS, the potential utility derived from system usage is likely to fall outside of the limits of enhancing one s job performance (cf. Davis 1989) and instead be related to social interaction and communication. The research constructs and their definitions are presented in Table 1. 5

6 Table 1. The Core constructs of the IS continuance model and their definitions Core construct Definition Confirmation Users perception of the congruence between expectations of the use of (CON) an IS and its actual performance (Bhattacherjee 2001b). Satisfaction (SAT) The effect of the confirmation of an IS s performance and its perceived usefulness form the basis of a user s satisfaction with the IS (Bhattacherjee 2001b). IS continuance Users intention to continue using an IS (Bhattacherjee 2001b). intention (CI) Perceived User s subjective probability that using an IS will offer gains in his or usefulness (PU) Perceived enjoyment (PE) her social interaction (Davis 1989; Dickinger et al. 2008). The extent to which using an IS is perceived as enjoyable in its own right (Davis et al. 1992). The relationships between the constructs presented in Table 1 are illustrated in Figure 1. PU CON SAT CI PE Figure 1. The IS Continuance model extended with perceived enjoyment Network externalities in technology adoption Prior literature, from various theoretical perspectives, has shown that an individual s decisions regarding the use of an IT are seldom made alone but are affected by other people s behaviour (Katz and Shapiro 1986; Markus 1987; Valente 1995). Network externalities have been empirically proven to influence the value and diffusion of communication technologies (Katz and Shapiro 1986). This is reflected in Metcalfe s law that postulates that the value of a telecommunications network is proportional to the square of the number of connected users (Shapiro and Varian 1999). Based on the theory of network externalities (Katz and Shapiro 1986; Shapiro and Varian 1999), it is plausible to 6

7 assume that an SVW as a communication technology can be influenced by network externalities. The theory of critical mass (Markus 1987) posits that there is a threshold number of users, described as critical mass, that a technological innovation requires to become selfsufficient. However, evaluating whether this threshold has been obtained may possess challenges for an individual user. Thus, people tend to rely on their perceptions of the extent of the usage rather than factual evidence (Van Slyke 2007). According to innovation diffusion theory, seeing others use of an IS positively affects the decision to adopt and use the technology (Moore and Benbasat 1991; Compeau et al. 2007). In virtual worlds, users are presented as avatars that interact in a collective 3D space. Thus, the presence of other users and their usage are clearly visible. In addition to the increased value stemming from network externalities, people have a tendency to adapt their behaviour based on the behaviour of others. This phenomenon, referred to as the bandwagon effect, has also been reported to operate with innovation diffusion (Abrahamson and Rosenkopf 1993). Due to their tendency to follow fads and fashion, young people are generally more likely to join bandwagons (Kastanakis and Balabanis 2012), which can reinforce the influence of network externalities. Thus, for an individual user, a network effect can be the result of different simultaneous cognitive processes. Finally, the value of interactive digital technologies is highly dependent upon the presence of relevant people, i.e. the user s personal network, rather than the network size in general (Lin and Bhattacherjee 2008). From a sociological perspective, this can be explained by the concept of homophily, i.e. the tendency to bond and associate with individuals with whom one perceives similarity (McPherson et al. 2001). Prior evidence from computer-mediated communication shows that interaction that involves the use of IT is likely to occur with key interpersonal relationships (Yuan and Gay 2006). Furthermore, the offline and online lives of young people have been found to be integrated so that the Internet is widely used to maintain offline social relationships (Subrahmanyam et al. 2008). While the presence of other people in general may be sufficient in the trial stage of one s SVW usage, the presence of one s key reference groups becomes important when 7

8 deciding whether to continue its usage or not. It is plausible to interpret that in relation to continued SVW usage because network externalities particularly stem from the presence of one s key social network in an SVW. Against this backdrop, we synthesize the aforementioned theoretical perspectives. We expand upon constructs from the prior literature such as perceived critical mass (Lou et al. 2000), perceived network size, (Lin and Bhattacherjee 2008) and other people's use (Compeau et al. 2007) to empirically examine the subjective evaluation of the presence of the users significant others in the SVW as the principal source of network externalities. Consequently, we do not focus on the different types of network externalities (Lu et al. 2010), but on the network that is required for the externalities to occur. The construct is named perceived aggregate network exposure (PANE) (Mäntymäki and Salo 2011) and defined as an individual s perception of the degree to which people from different reference groups are present in an SVW. PANE captures the perception of the extent to which the innovation is used among certain specific reference groups such as friends and peers as well as the overall evaluation of the degree of usage among one s significant others. We argue that PANE captures a broader view of network externalities than other similar constructs used in prior literature such as perceived critical mass (Lou et al. 2000), perceived network size (Lin and Bhattacherjee 2008), other people's use (Lin and Bhattacherjee 2008) or number of members among friends (Lin and Lu 2011). For example, Lou et al. (2000) conceptualized perceived critical mass as significant peers. They focused only on class and group mates for measuring perceived critical mass in the groupware acceptance context. However, the decisions to adopt and continuously use an SVW are not based solely on classmates (Lou et al. 2000), or friends' (Lin and Lu 2011) usage but are also influenced by a number of one's important reference groups. Hence, we argue that a conceptually broad network externalities construct such as PANE that captures different referents' usage behaviour is particularly appropriate in the SVW context. 8

9 3. Research model and hypotheses As the prior literature has shown, the role of network externalities in technology adoption and use is less straightforward than a clear linear or exponential relationship between the number of users and the value of the communication technology (Markus 1987; Abrahamson and Rosenkopf 1993). Furthermore, prior literature offers mixed empirical evidence on that the number and presence of other users influences e.g. the perceived usefulness, enjoyment and continuance of communication technologies (Li et al. 2005; Zhou and Lu 2011; Mäntymäki and Salo 2011). These studies have modelled perceived critical mass (and similar constructs) as the determinant of e.g. perceived usefulness (Li et al. 2010), enjoyment (Lin and Lu 2011), satisfaction (Zhou and Lu 2011) and continuance intention (Mäntymäki and Salo 2011) as well as reported non-significant relationships (Mäntymäki and Salo 2011; Zhou and Lu 2011). The results found in prior literature suggest that the number of other people in general or even one's friends using an SVW may not have a direct positive influence on use decisions. Instead, the theory of network externalities posits that the value of the technology for an individual is positively associated with the number of people using the technology (Katz and Shapiro 1985; Katz and Shapiro 1986; Shapiro and Varian 1999). Hence, to advance the understanding of the role of network externalities in IS continuance, we present a line of reasoning grounded on social psychology (Ajzen 2001; Förster and Liberman 2007) and communication research (Daft and Lengel 1986). We argue that PANE may not necessarily have a direct effect on IS continuance but that it influences user's processing of information related to the value of an SVW. Hence, PANE manifests itself through being embedded in the motivational structure that drives the use decisions. The presence of one's key referents covered by PANE helps evaluate the value related to using an SVW for entertainment or social interaction among one's existing social network and thus makes the value cognitively more accessible (Ajzen 2001; Förster and Liberman 2007). In contrast, a user who experiences a low level of PANE needs to put more effort to develop an in-world social network if he or she wishes to use an SVW for social interaction with other users. This in turn makes evaluating the value of an SVW cognitively more 9

10 challenging for users experiencing lower levels of PANE. From a communication perspective, as people tend to communicate online with those who they already know (Yuan and Gay 2006), a high level of PANE is likely to increase communication and exchange of information with other users. Increased communication in turn reduces uncertainty and equivocality and thus helps decision-making (see e.g. Daft and Lengel 1986). Consequently, the communication with other users supported by PANE is likely to contribute to user's processing of information related to the value of an SVW, the formation of satisfaction/dissatisfaction and eventually the continuance intention. Enhanced information processing in turn increases congruence between beliefs, satisfaction and continuance intention and eventually strengthens the relationships between these constructs. Therefore, we assert that PANE reinforces the role of the perceived usefulness and enjoyment as well as satisfaction in user s decision-making process. Instead of the conventional approach of viewing PANE as an antecedent, it is theoretically more insightful but also logically reasonable to assume that PANE moderates the relationships between beliefs, satisfaction and behavioural intention. Based on these arguments, we place PANE as a moderator in the extended IS continuance model. The research model is presented in Figure 2. PANE PU Hypotheses are shown with thick vertical arrows CON SAT CI PE Figure 2. The Research model 10

11 The IS continuance model places satisfaction as a determinant of behavioural intention (Bhattacherjee 2001b; Thong et al. 2006). Based on evidence from the technologies used for communication and social interaction, such as instant messaging (Lin and Bhattacherjee 2008; Li et al. 2010) and social networking sites (Lin and Lu 2011), we argue that an extensive social circle within the service generally increases the hedonic and utilitarian value derived from using the SVW. This in turn is likely to lead to a positive overall evaluation of using the SVW depicted by satisfaction. In addition, the increased communication and social interaction with other users facilitated by PANE makes the overall evaluation more accurate and hence a better predictor of intention. As a result, we interpret that PANE reinforces the role of satisfaction as a predictor of continuance intention and hypothesize: H1: The influence of satisfaction on continuance intention is moderated by PANE, such that the effect will be stronger for users perceiving high PANE. The IS continuance model posits that perceived usefulness predicts satisfaction and continuance intention (Bhattacherjee 2001b). Social interaction and communication have been found to be key affordances driving SVW usage (Eisenbeiss et al. 2012). Consequently, in the present study, we conceptualize perceived usefulness of the SVW to reflect its value for communication and social interaction. In general, a large degree of one's friends and peers involved in the SVW offers a user more opportunities for social interaction and hence increases the perceived usefulness of the platform. Moreover, the increased interaction with other users is likely to help the user to evaluate the usefulness of the SVW more accurately. This in turn reinforces the relationship between perceived usefulness, satisfaction and continuance intention. As a result, it is plausible to assume the relationships between perceived usefulness and satisfaction and continuance intention are positively affected by PANE. Thus, we put forward the respective hypotheses: H2: The influence of perceived usefulness on satisfaction is moderated by PANE, such that the effect will be stronger for users perceiving high PANE. H3: The influence of perceived usefulness on continuance intention is moderated by PANE, such that the effect will be stronger for users perceiving high PANE. 11

12 Using an SVW for hedonic purposes, such as playing in-world games, participating in celebrity visits or organizing parties is presumably more enjoyable when one's friends and peers are present in the platform. This notion is supported by the research on social networking sites and instant messaging that has found that perceived network externalities influence the hedonic factors that in turn drive the usage decisions (Li et al. 2010; Lin and Lu 2011). Similarly, with respect to SVWs, prior literature offers empirical evidence that the hedonic value of a virtual world is dependent on one's potential in-world social network, i.e. the degree of friends and peers involved in the platform (Mäntymäki and Salo 2011). As a result, with regard to the moderating effect, it is plausible to assume that perceived network externalities strengthen the role of enjoyment as a predictor of satisfaction and continuance intention. Similarly than with perceived usefulness, we argue that the increased social interaction and communication facilitated by PANE makes one's evaluations more accurate and hence decreases potential discrepancies between perceived enjoyment, satisfaction and continuance intention. Thus, as with perceived usefulness, we propose that PANE reinforces the relationships between perceived enjoyment and satisfaction as well as continuance intention and postulate the following hypotheses: H4: The influence of perceived enjoyment on satisfaction is moderated by PANE, such that the effect will be stronger for users perceiving high PANE. H5: The influence of perceived enjoyment on continuance intention is moderated by PANE, such that the effect will be stronger for users perceiving high PANE. Finally, the IS continuance model posits that satisfaction and perceived performance (usefulness and enjoyment) are determined by confirmation (Bhattacherjee 2001b). Given that most activities in a social virtual world take place in interaction with other users, a large degree of one's key referents participating the in-world social network is likely to increase the amount of interaction with other users and thus increase the amount of information exchanged. Users are likely to utilize this information when evaluating the degree to which the performance of the SVW met their expectations and forms their overall satisfaction. In other words, a high level of PANE decreases the discrepancies between expectations and performance because users with a large in-world social network are likely 12

13 to be well-informed about the features of the SVW and its current social setting. As a result, a high degree of PANE is likely to help users form more realistic expectations of the performance of an SVW when determining their overall satisfaction. Based on these arguments, we hypothesize the following: H6: The influence of confirmation on satisfaction is moderated by PANE, such that the effect will be stronger for users perceiving high PANE. As the relationships between confirmation and post-adoption beliefs (e.g., perceived usefulness and perceived enjoyment) have been verified extensively in prior literature and in different settings, including SVW (Lin & Lu 2011; Mäntymäki & Salo 2011), we expect these relationships also hold in our context. However, we do not see theoretical or logical justifications strong enough to hypothesize PANE as having a moderating effect on these relationships. 4. Empirical research 4.1. Data collection and measurement The data was collected through an online survey among the users of the Finnish Habbo Hotel portal in co-operation with Sulake Corporation, the Finnish company that owns and maintains Habbo Hotel. The survey was available for one week for the respondents. The Finnish portal was selected because it was launched in 2000 and has become popular among Finnish teenagers. Moreover, new features within Habbo are often tested among Finnish users before being launched globally. In contrast to Second Life, Habbo Hotel users log on at a local portal and each portal has its own specific content. Hence, the user experience is, at least to some extent, country-specific. The survey was constructed in English. The research constructs were measured with items from prior IS literature. The survey instrument with references to respective literature is presented in Appendix A. With regard to the measurement of PANE, the items were adopted from Lin & Bhattacherjee (2008) except for the fourth item, which was developed to measure the user s subjective evaluation of the most meaningful people present in an 13

14 SVW. The constructs were measured with a seven-point Likert scale ranging from strongly disagree to strongly agree, except for PANE and satisfaction, which were measured with a semantic scale. All constructs were modeled using reflective indicators. PANE was modeled as a reflective construct, since dropping one of the measurement items would not change the conceptual domain of the construct. Moreover, in terms of the nomological content of the items, the groups of the items permit overlapping members. Prior to the main data collection, the survey instrument was tested with a sample of Canadian Habbo Hotel users to ensure the applicability of the measures. The questionnaire was then translated into Finnish by two IS researchers, both native Finnish speakers. Finally, the questionnaire was double-checked by a certified translator and employees of Habbo Hotel to ensure that the questions were understandable for the target group. To follow the ethical guidelines for conducting research among minors, the respondents were anonymous (as they are in Habbo Hotel). Additionally, the questionnaire did not include questions concerning any potentially sensitive topics. The survey was opened 8,928 times and 3,265 respondents proceeded to the final page and submitted the survey. This yielded a completion rate of 36.6 per cent. To further ensure the reliability of the results, only fully completed questionnaires were included in the analysis. As a result, the final sample consisted of 2,134 responses. The age and gender distribution of the respondents is provided in Table 2. Table 2. Age and gender distribution of the sample Gender Age Count Percent Count Percent Female < Male >

15 4.2. Measurement model The data was analysed using structural equation modeling (SEM) with Amos 8.0 software. To assess the model fit and construct reliability and validity, the data analysis began with a confirmatory factor analysis of the measurement model. Maximum likelihood estimation was used since it has proven robust with large sample sizes and under conditions of non-normality. Convergent validity indicates the degree to which the items of a scale that are theoretically related are also related in reality. The convergent validity was evaluated based on three criteria: first, all indicator factor loadings should be significant and exceed Second, the composite reliabilities should exceed Third, the average variance extracted (AVE) of each construct should be greater than the variance due to measurement error (AVE > 0.50) (Fornell and Larcker 1981). As can be seen from Table 3, these criteria were met. Table 3. Descriptive statistics and convergent validity Item mean Std.dev. loading C.R. AVE PU PU PU PU CON CON CON PE PE PE SAT SAT SAT SAT CI CI CI PANE PANE PANE PANE

16 Discriminant validity reflects whether the items measure the construct in question or other constructs. The AVE for each construct should exceed the squared correlation between that and any other construct (Fornell and Larcker 1981). The test for discriminant validity is presented in Table 4 below. As can be seen from the table, this test was met. Table 4. Squared loadings between constructs (AVEs bolded in the main diagonal) PU ENJ CON SAT CUI PANE PU 0,761 ENJ 0,526 0,714 CON 0,383 0,500 0,705 SAT 0,288 0,448 0,316 0,753 CUI 0,334 0,514 0,579 0,297 0,695 PANE 0,263 0,140 0,213 0,117 0,150 0,753 Once the convergent and discriminant validity were proved to be acceptable, the goodness-of-fit of the CFA model was investigated. All the fit indices for the measurement model demonstrated a good model fit (GFI=0.932; CFI=0.969; TLI=0.963; SRMR=0.046; RMSEA=0.056). Thus, we proceeded to test the structural model Structural model We first ran the structural model with the whole data to test whether the key relationships of the IS continuance model hold in our context. To examine the moderating effects of PANE, we followed the multi-group procedure based on Jöreskog and Sörbom (1993) suggested by Dabholkar and Bagozzi (2002). This approach not only allows testing whether the differences between the groups are statistically significant but also allows controlling for the potential influence of factorial invariance (Steenkamp and Baumgartner 1998). We first summed the item scores of PANE. Then, we split the sample into two groups using the median of the total item scores of PANE as the threshold. Thereafter, we ran the structural model with both subsamples as well as the whole sample using the multi-group analysis feature of AMOS. A chi-square test was used to identify significant differences 16

17 across the subsamples. After having tested the six hypothesized relationships, we conducted a post-hoc analysis to examine the potential moderating effect of PANE on the relationships between confirmation and perceived usefulness as well as perceived enjoyment, which were not formally hypothesized. Altogether, we identified a number of significant differences across the subsamples. The results are presented in Table 5 below. Table 5. Results of the multi-group analysis to test of the hypothesized relationships (significant moderating effects based on chi-square differences in bold) Relationship low PANE high PANE whole data SAT CI n.s *** 0.090*** PU SAT 0.068* 0.103** 0.101*** PU CI 0.066* 0.219*** 0.141*** PE SAT 0.639*** 0.356*** 0.493*** PE CI 0.683*** 0.450*** 0.588*** CON SAT n.s *** 0.150*** CON PU (not hypothesized) 0.594*** 0.610*** 0.655*** CON PE (not hypothesized) 0.770*** 0.651*** 0.747*** *** p<.001; ** p<0.01; * p<0.05 Finally, we conducted a series of F-tests to compare the explanatory power of the baseline model without PANE, the direct effect model and the moderating effect model. The results are shown in Table 6. The comparison showed that including PANE as an antecedent increased the variance explained for both the endogenous variables by less than one percentage point. The nested F-test confirmed that the increase in explanatory power is not significant. With respect to the moderating effect model, we found that the explanatory power of the model varied considerably across the low and high PANE groups. The explanatory power increased to around seven percentage points for the low PANE group and decreased to around fourteen percentage points for the high PANE group compared to the baseline model. The nested F-tests confirmed that the differences of the explained variances are 17

18 significant at p<0.01, which further supported our assertion that PANE is more accurately positioned as a moderator. Table 6. Explanatory power of the baseline model, the model with PANE as an antecedent, and the proposed model with PANE as a moderator Model R 2 Satisfaction F-test significance Baseline Model 45.5 % 53.5 % PANE as an antecedent PANE as a moderator Continuance intention 45.9% n.s % n.s. R 2 F-test significance 52.6 % (low group) p< % (low group) p< % (high group) p< % (high group) p<0.01 Taken together, the results offered support for only two out of six hypotheses as Figure 3 illustrates. PANE PU CON SAT CI PE supported not supported Figure 3. Results of the hypotheses testing 18

19 The results demonstrate that the satisfaction-intention relationship was surprisingly weak and not even significant among the low PANE group. With regard to the moderating effect, PANE was found to reinforce the link between satisfaction and continuance intention (H1 supported). The results further show that perceived usefulness exerted a relatively small influence on satisfaction as well as continuance intention. PANE did not moderate the relationship between perceived usefulness and satisfaction and hence H2 was not supported. In line with our third hypothesis, PANE was found to reinforce the relationship between perceived usefulness and continuance intention. Interestingly, contrary to the hypotheses (H4 and H5), the influence of perceived enjoyment on satisfaction and continuance intention was found to be stronger among users experiencing low levels of PANE. The interpretation of this finding is that the users can enjoy the engagement in the SVW in smaller groups of best buddies, without necessarily having extensive in-world network. Thus, compared to perceived usefulness, perceived enjoyment is less influenced by PANE. Finally, PANE did not influence the relationship between confirmation and satisfaction and hence H6 was not supported. A detailed summary of the testing of the hypotheses is presented in Table 7. 19

20 Table 7. Summary of the hypotheses testing Hypothesis H1: The influence of satisfaction on continuance intention is moderated by PANE, such that the effect will be stronger for users perceiving high PANE. H2: The influence of perceived usefulness on satisfaction is moderated by PANE, such that the effect will be stronger for users perceiving high PANE. H3: The influence of perceived usefulness on continuance intention is moderated by PANE, such that the effect will be stronger for users perceiving high PANE. H4: The influence of perceived enjoyment on satisfaction is moderated by PANE, such that the effect will be stronger for users perceiving high PANE. H5: The influence of perceived enjoyment on continuance intention is moderated by PANE, such that the effect will be stronger for users perceiving high PANE. H6: The influence of confirmation on satisfaction is moderated by PANE, such that the effect will be stronger for users perceiving high PANE. Outcome Supported Not Supported Supported Not supported (negative moderating effect) Not supported (negative moderating effect) Not supported Our results indicate that the utilitarian motives of usage appear to be more salient among users experiencing a strong network exposure, whereas users with low levels of PANE tend to be more hedonically driven. Taken together, PANE influences the motivational structure underlying continuance intention and satisfaction. This can be explained by the fact that the primary hedonic activities in the SVW, such as playing in-world games or attending concerts and other events, do not require an extensive in-world social network. On the other hand, using Habbo Hotel for more utilitarian purposes, such as communicating with friends, or getting help with homework, essentially mandates the presence of like-minded other users. Surprisingly, in contrast with the key assertions of the IS continuance model (Bhattacherjee 2001b) and findings of prior studies on continued virtual world usage (Jung 2011), the results show that satisfaction does not drive teenagers SVW participation and 20

21 that confirmation is a surprisingly weak predictor of satisfaction. The implications of our results are discussed in the following section. 5. Discussion 5.1. Theoretical implications Our study has five main theoretical implications, that contribute to two areas, the research on virtual world usage and the research on IS continuance. The first two implications are directed to the literature on virtual world usage. Prior literature indicates that the motivational structure driving use decision varies across platforms and user groups. For example, while Barnes (2011) found continuance of SVW being driven by perceived usefulness, Mäntymäki & Salo (2011) found perceived enjoyment being a stronger predictor of continuance than perceived usefulness. Hence, our first implication to the literature on virtual world use is that perceived network effects we captured with PANE tilt the motivational structure underlying continued SVW usage and satisfaction. The results further show that while continued SVW usage is clearly predominantly hedonically oriented, users with an extensive in-world social network tend to put more emphasis on the utility extracted from the usage. Altogether, examining the moderating role of perceived network externalities complements the current understanding of continued virtual world use (Goel et al. 2011; Mäntymäki and Salo 2011; Jung 2011; Barnes 2011; Merikivi et al. 2012). Second, in contrast to results from prior virtual world research among adult users (Jung 2011) but in line with findings from young SVW users (Mäntymäki and Salo 2011), we have shown that teenagers continued participation in an SVW is surprisingly weakly determined by satisfaction, regardless of the perceived network externalities. This may indicate that young users ground their usage decisions on the perceived utilitarian and hedonic value extracted from SVW participation, rather than on the aggregated overall evaluation represented by satisfaction. From a contextual standpoint, the highly dynamic usage context of SVWs, characterized by a frequent flow of new activities and features 21

22 introduced by the operator as well as the constantly evolving in-world social setting between the users offers a potential explanation for the weak influence of satisfaction. The second set of implications is related to IS continuance literature. First, we propose that satisfaction may be a less powerful predictor of continuance intention in highly dynamic use contexts and amongst younger user groups. Second, with regard to hedonic systems, perceived enjoyment has been found to be the predominant predictor of usage, while utilitarian aspects play a less important role (van der Heijden 2004). We assert that the perception that one s key reference groups use an IS tilts the motivational structure in a utilitarian direction. Our results show that the role of perceived usefulness as a predictor of continuance intention is reinforced when a user experiences high PANE. Perceived enjoyment in turn is the dominant factor when among individuals who experience low PANE. Altogether, the results demonstrate that PANE moderates most of the relationships in the IS continuance model. Thus, future IS continuance studies, particularly when examining social and collaborative technologies (e.g. e-learning, social networking sites, blogs), should consider how to incorporate PANE in the empirical research setting. Third, PANE did not moderate the influence of confirmation on satisfaction. This may indicate that the influence of one s in-world social network is rather realistically incorporated in both the expectations and the performance evaluations. Thus, rather than being a moderator, PANE could be positioned as an antecedent of confirmation (cf. Mäntymäki and Merikivi 2010) Implications for practice First of all, the results reveal that perceived enjoyment is the primary driver of teens sustained SVW participation. Thus, creating an environment that supports an enjoyable experience is important. Our results further reveal that perceived enjoyment is more important in predicting satisfaction and continuance intention for the low PANE group, while perceived usefulness is more important for the high PANE group in predicting satisfaction and continuance intention. As a result, virtual world operators and system 22

23 developers should investigate what features and system characteristics, along with the attributes of the social context, constitute both enjoyment and usefulness. Second, as confirmation was found to be a very powerful predictor of both perceived enjoyment and usefulness, it is advisable for virtual world operators to place an emphasis on ensuring that the overall user experience remains consistent. Third, the moderation effect of PANE implies that the social context is largely cocreated by users rather than by the actions of the operators. This reduces the control of the operator regarding perceived user experience. In such a situation, a radical change of user interface may hamper the content creation process. Thus, to maximize users opportunities and abilities for effective content creation and a stable user experience, it is advisable for operators to avoid radical changes in the user interface Limitations and further research Our study is subject to several limitations. First, our empirical data was collected from one social virtual world (Habbo Hotel), from one country only (Finland) and focused on only one relatively narrow age group (teenagers). Therefore, the statistical generalizability of the results is evidently limited. Second, we employed only self-reported measures. Although we intentionally focused on perceived network externalities in this study, we urge further research to focus on more objective approaches. Third, due to practical reasons, the data collection was cross-sectional, thus offering only a snapshot of the phenomenon of interest. As IS continuance is essentially something that takes place over time, a longitudinal research setting would enable a more accurate investigation of how usage continues and evolves. Fourth, although we extended the original IS continuance model with perceived enjoyment to better accommodate the usage context, the belief structure is by no means exhaustive. For example, the user interface of virtual worlds is essentially built on avatarbased navigation and a three-dimensional graphical environment. A large number of users in one s in-world social circle is likely to increase the pace of social interaction and 23

24 therefore reinforces the importance of usability. As a result, the performance of the user interface can also be affected by PANE. In addition to further research stemming directly from the limitations of this study, we encourage further research in three areas. First, as habit has been found to act as a moderator in the IS continuance model (Limayem et al. 2007; Limayem and Cheung 2011) we suggest future research to examine PANE together with habit as a moderator in the IS continuance model. Second, culture has been found to affect individual s decisions on technology usage (Straub and Keil 1997; Hwang and Lee 2012; Hwang 2012). A recent meta-analysis of IS continuance literature suggest that part of the flux in the results may be attributable to cultural factors (Islam and Mäntymäki 2011). As a result, we suggest future research empirically investigates the role of individual-level culture, such as gender and education, and conducts studies in several countries to further advance the understanding of the role of culture in IS continuance. With regard to the third and final area of further research, the respondents of this study consisted of digital natives (Prensky 2001), i.e. individuals that have grown up with information technology and who are said to perceive e.g. the concepts of privacy and friendships somewhat differently to those of older generations (Palfrey and Gasser 2008). For example, engagement in a social virtual world can offer young people a wide array of potential affordances that range from fulfilling fundamental psychological needs, such as building self-image and social identity, to recreational activities, such as participating in celebrity visits and concerts. Further research should therefore examine the distinct features of digital natives IT usage behaviour (Vodanovich et al. 2010). References Abrahamson, E. and Rosenkopf, L., 1993, Institutional and Competitive Bandwagons: Using Mathematical Modeling as a Tool to Explore Innovation Diffusion. The Academy of Management Review, 18 (3), pp Ajzen, I., 2001, Nature and operation of attitudes. Annual Review of Psychology, 52 (1),

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