Essays on Digital Entrepreneurs’ Strategic Categorization Strategies

Randy Lau, a passionate filmmaker and storyteller from California, finally started his own YouTube channel, "Made with Lau," aiming to share his dad’s Chinese recipes and family stories in September 2020. Randy lost his job during the COVID-19 pandemic, and his family was expecting a new baby then. The financial pressure and free time during the quarantine inspired Randy to share recipes of his dad, who has over 50 years of experience cooking in Chinese restaurants, on YouTube to make earnings. After navigating the initial uncertainties and fluctuations, Randy’s channel skyrocketed to amass 400,000 subscribers and generated an average monthly revenue of $50,000 within a year. Randy now has become a full-time YouTuber and works with a small team in creating and editing videos. The entrepreneurial success of Randy on the YouTube platform is not unparalleled. The rise and popularity of digital platforms such as YouTube and Twitch have provided great opportunities for entrepreneurs to explore their talents and share quality content while earning a living. The anecdotal success of “Made with Lau” motivates one exciting research question in the field of digital entrepreneurship: How do digital entrepreneurs like Randy establish and sustain their businesses in such a competitive and dynamic environment? Specifically, what types of content strategies do they apply, and how do they pivot strategies based on market trends and audience feedback? Motivated by these questions that new digital entrepreneurs face, this dissertation explores how entrepreneurs apply and pivot their content strategies on digital platforms and its performance implications. This dissertation encompasses three chapters to examine this broad question, followed by a conclusion section. Chapter 1 is an introductory chapter where I review prior literature on digital entrepreneurship through the lens of organization theory such as optimal distinctiveness(OD)and cultural entrepreneurship. I also identify the gap in the literature to motivate the remainder of the dissertation. Chapter 2 examines how YouTubers can incorporate their personal identity, their persona, into the digital content and enhance the effectiveness of category spanning strategies. Whereas category-spanning has been regarded as legitimacy-deducting and would harm producers’ performance, I found that if digital entrepreneurs can anchor their persona identity into content and establish para-social relationships with their audience, the category-spanning strategies may enhance their performance. Chapter 3 investigates the categorization strategies of nascent entrepreneurs (YouTubers) after they enter the market. Specifically, I examine the effectiveness of conforming to two types of reference points: category exemplars and past self. Whereas both strategies can enhance the performance of entrepreneurs, simultaneously pursuit of both could jeopardize it. In addition, the effectiveness of upholding a consistent identity would decay with the age of the channel. This study provides insights to cultural entrepreneurship and categorization literature. In conclusion, I summarize the key insights generated from the dissertation, its contribution, limitations, and directions for future research.