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on Marketing |
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Issue of 2013‒09‒28
five papers chosen by Joao Carlos Correia Leitao University of Beira Interior and Technical University of Lisbon |
| By: | Hagiu, Andrei; Jullien, Bruno |
| Abstract: | Platforms use search diversion in order to trade off total consumer traffic for higher revenues derived by exposing consumers to products other than the ones that best fit their preferences. Our analysis yields three key and novel insights regarding search diversion incentives, which have direct implications for platforms’ strategies and empirical predictions. First, platforms that charge positive access fees to consumers have weaker incentives to divert search relative to platforms that cannot (or choose not to) charge such fees. Second, endogenizing the affiliation of products that consumers are not interested in (advertising) leads to stronger incentives to divert search relative to the exogenous affiliation (vertical integration) benchmark, whenever the marginal product yields higher profits per consumer exposure relative to the average product. Third, the effect of platform competition on search diversion incentives depends on the nature of competition. Competition for advertising leads to more search diversion relative to competition for consumers. Both types of competition lead to at least as much search diversion as a monopoly platform. Nevertheless, in the case of competing platforms, the equilibrium level of search diversion increases with the degree of horizontal differentiation between platforms. |
| Keywords: | Competition; Search platforms; Two-sided market |
| JEL: | L1 L2 L8 |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:9451&r=mkt |
| By: | Illichmann, Rebecca; Abdulai, Awudu |
| Abstract: | This study employs a choice experiment approach to investigate consumers’ preferences and WTP for organic food products. We use mixed logit models to examine preference heterogeneity. The results revealed significant heterogeneity in preferences for organic apples, milk, and beef product attributes among consumers. The willingness-to-pay (WTP) results obtained from mixed logit indicate gender-specific differences for the examined products of this study. Female respondents have a higher WTP for apple attributes, while higher WTP values for milk and beef attributes are observed for male respondents. |
| Keywords: | Organic farming, choice experiment, preference heterogeneity, mixed logit, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety, |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:ags:gewi13:156100&r=mkt |
| By: | Joe Cox (Portsmouth Business School); Daniel Kaimann (University of Paderborn) |
| Abstract: | Experience goods are characterized by information asymmetry and a lack of ex ante knowledge of product quality, such that credible and reliable external signals of product quality are likely to be highly valued. Due to their independence and expert reputations, professional critics therefore have the potential to significantly influence buyer behavior and hence product demand. In order to empirically verify the influence of critic reviews on market success, we analyze a sample of 1,480 video games and their sales figures between 2004 and 2010. We find strong evidence to suggest that reviews from professional critics have a significant effect upon sales and serve as a signal that helps consumer to overcome uncertainty and support the decision making process. The influence of professional critics on sales is also found to substantially outweigh that of word-of-mouth reviews from other consumers. |
| Keywords: | Signaling Theory, Information Asymmetry, Critics, Video Games |
| JEL: | C31 D82 L14 L82 |
| Date: | 2013–09 |
| URL: | http://d.repec.org/n?u=RePEc:pdn:wpaper:68&r=mkt |
| By: | Courty, Pascal; Liu, Wenyu |
| Abstract: | We study opaque selling in the hotel industry using data from Hotwire.com. An opaque room discloses only the star level and general location of the hotel at the time of booking. The exact identity of the hotel is disclosed after the booking is completed. Opaque rooms sell at a discount of 40 percent relative to regular rooms. The discount increases when hotels are more differentiated. This finding is consistent with static models of price discrimination. No support was found for predictions specific to inter-temporal models of opaque selling. |
| Keywords: | inter-temporal price discrimination; opacity; Opaque selling; product differentiation |
| JEL: | L0 L15 L83 |
| Date: | 2013–05 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:9463&r=mkt |
| By: | Kriep, Laura; Möser, Anke |
| Abstract: | Vor dem Hintergrund eines steigenden Außer-Haus-Verzehrs gibt der Beitrag interessante Einblicke in die Preisgestaltung im Food-Service-Bereich auf Basis eines eigens erhobenen Querschnittsdatensatzes. Besonderes Augenmerk liegt dabei auf bequemen Transaktionspreisen, welche nach Knotek (2011) durch die geringere Anzahl benötigter Geldeinheiten den Kaufprozess vereinfachen. Die empirische Analyse bestätigt, dass im Food-Service-Sektor glatte Preise, die auf einen vollen Eurobetrag enden, sowie runde Preisstellungen dominieren. Einzige Ausnahme stellen Selbstbedienungsrestaurants dar, die verstärkt gebrochene Preise nutzen und bei denen im Vergleich zu einer Imbissbude folglich mindestens eine Geldeinheit pro Transaktion mehr benötigt werden würde. |
| Keywords: | Food-Service-Bereich, Preisstrategien, Transaktionskosten, multivariate Analysen., Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, Marketing, |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:ags:gewi13:156146&r=mkt |