The Double-Edged Sword of Communication Substantiveness in the Pursuit of Strategy Uniqueness

This study investigates the dual-edged nature of corporate communication substantiveness on online interactive platforms in the context of strategy uniqueness. Drawing upon the interplay between information discount cost and proprietary cost, we argue that firms with high strategy uniqueness face conflicting pressures. On one hand, increased communication substantiveness reduces information asymmetry, enhancing investor understanding and firm valuation. On the other hand, excessive communication substantiveness exposes firms to proprietary risks, including competitive imitation. We theorize an inverted U-shaped relationship between corporate strategy uniqueness and communication substantiveness in online platforms. Additionally, we examine moderating factors—industry environment munificence, state ownership, and managerial ability—that shape firms’ strategic responses. By leveraging data from China’s leading online interactive platforms—“Hudongyi” and “Ehudong”, and comprising 24,777 firm-year observations, our findings provide nuanced insights into how firms navigate the strategic trade-offs inherent in digital transparency. The study advances theoretical perspectives on corporate communication in the digital era and offers practical implications for information systems scholars and practitioners.