Question

An example of the ___________ effect is when BMW gained in-depth information about visitors to a popular Chinese social media site and used that information to determine which visitors were likely to be luxury car buyers and targeted advertising toward them.

Answer 1

Answer:

information effect.

Explanation:

Based on the information provided within the question it can be said that the effect being illustrated in this scenario is known as the information effect. This term refers to when a company obtains confidential information that allows them to make specific decisions to drastically increase their position within the market. Such as BMW is doing by using the information to target the correct population segment within the market.

Answer 2

Answer:

information

Explanation:

In business, the information effect refers to a company or investor taking advantage of new relevant information that they possess in order to increase sales volume or trade securities (or assets) before that information is available to the general public. When an employee of a company uses information for his/her own benefit it is illegal and is referred to insider information.

In this case, BMW gained information legally about their website visitors and is using that private information to gain a competitive advantage and increase its sales. The information itself becomes an intangible asset (even though you cannot assign a value to it) because it helps companies increase their sales volume.