Turning Social Capital into Economic Capital: the Sales Effect of Friendship Group Participation in Social Commerce Websites

Friendship groups have been widely adopted in social commerce platforms because of the powerful and pervasive influence of groups on decision making. Despite their widespread use, the sales effects of seller participation in friendship groups (FGP) have received limited research attention. Using a quasi-experimental design with 373,964 products from 8,250 sellers on a leading social commerce platform, we find that FGP increase sellers' product sales performance through the formation of relational and cognitive capital. In addition, we find that seller guarantee, product guarantee and product rating strengthen the sales effect of FGP, while the number of seller followers weakens the sales effect of FGP. Our study contributes to the literature by examining how, why, and when FGP affect sales performance in social commerce. We also provides guidance for sellers and platforms to use friendship groups and group marketing to improve sales performance in social commerce.