nep-mkt New Economics Papers
on Marketing
Issue of 2014‒04‒11
six papers chosen by
Joao Carlos Correia Leitao
Universidade da Beira Interior and Universidade de Lisboa

  1. Add-on pricing in retail financial markets and the fallacies of consumer education By Kosfeld, Michael; Schüwer, Ulrich
  2. Consumer flexibility, data quality and location choice By Baye, Irina; Hasnas, Irina
  3. Building Customer Loyalty among SMEs in Uganda: The Role of Customer Satisfaction, Trust, and Commitment By Dr. Terry Najja Kakeeto-Aelen; Professor Jan C van Dalen; Professor H. Jaap van den Herik; Dr. Bartel A. Van de Walle
  4. The Determinants Of Online Merchant’s Price Premium: Evidence From Russia By Evgeny A. Antipov
  6. Loyalty Programs : a study case in the Hospitality Industry By Lubica Hikkerova

  1. By: Kosfeld, Michael; Schüwer, Ulrich
    Abstract: This paper explores consequences of consumer education on prices and welfare in retail financial markets when some consumers are naive about shrouded add-on prices and firms try to exploit it. Allowing for different information and pricing strategies we show that education is unlikely to push firms to disclose prices towards all consumers, which would be socially effifficient. Instead, price discrimination emerges as a new equilibrium. Further, due to a feedback on prices, education that is good for consumers who become sophisticated may be bad for consumers who stay naive and even for the group of all consumers as a whole. --
    Keywords: consumer education,financial literacy,bounded rationality,competition,regulation
    JEL: D40 D80 L50
    Date: 2014
  2. By: Baye, Irina; Hasnas, Irina
    Abstract: We analyze firms' location choices in a Hotelling model with two-dimensional consumer heterogeneity, along addresses and transport cost parameters (flexibility). Firms can price discriminate based on perfect data on consumer addresses and (possibly) imperfect data on consumer flexibility. We show that firms' location choices depend on how strongly consumers differ in flexibility. Precisely, when consumers are relatively homogeneous, equilibrium locations are socially optimal regardless of the quality of customer flexibility data. However, when consumers are relatively differentiated, firms make socially optimal location choices only when customer flexibility data is perfect. These results are driven by the optimal strategy of a firm on its turf, monopolization or market-sharing, which in turn depends on consumer heterogeneity in flexibility. Our analysis is motivated by the availability of customer data, which allows firms to practice third-degree price discrimination based on both consumer characteristics relevant in spatial competition, addresses and transport cost parameters. --
    Keywords: Location Choice,Price Discrimination,Customer Data
    JEL: D43 L13 R30 R32
    Date: 2014
  3. By: Dr. Terry Najja Kakeeto-Aelen (Maastricht School of Management, The Netherlands); Professor Jan C van Dalen (Maastricht School of Management, The Netherlands); Professor H. Jaap van den Herik (Tilburg University, The Netherlands); Dr. Bartel A. Van de Walle (Tilburg University, The Netherlands)
    Abstract: In the marketing arena, the last two decades have been characterised by increased attention towards the subject of Relationship Marketing (RM). Both academics and practitioners today increasingly recognize RM as one of the main marketing strategies that is necessary to keep companies visible and competitive in the eyes of their customers. However, what we observe is that inspite of increased interest in the subject, we know quite little, from an empirical perspective, about the manner in which Small and Medium Enterprises (SMEs), especially those in developing countries, use RM to build and enhance long-term relationships with their customers and thus remain competitive. The purpose of this article is to examine the role of customer satisfaction, trust and commitment in the formation and enhancement of long-term customer relationships among SMEs in the service sector in Uganda and to suggest practical tools that policy makers in developing countries can use to enhance SME competitiveness. We obtained the required data for the study from SME owner-managers, customers, and frontline employees of SMEs operating in two service sectors in Uganda, namely the restaurant sector and the travel-agency sector. Our findings indicate that customer satisfaction, trust and commitment all play a significant role in the building and enhancement of long-term customer relationships among SMEs in Uganda. However, their role varies between different SME sectors. The findings also show that in general, those SMEs whose RM practices customers were more satisfied with had higher levels of customer loyalty compared to those SMEs whose RM practices customers were less satisfied with. This study has increased our awareness about the processes that SMEs in developing countries go through to build customer loyalty and thus long-term competitiveness. In this way, the study has helped to narrow the gap in current literature about the RM practices of SMEs in developing countries.
    Keywords: Relationship Marketing, SMEs, Customer Satisfaction, Trust, Commitment, Customer Loyalty
    Date: 2014–03
  4. By: Evgeny A. Antipov (National Research University Higher School of Economics)
    Abstract: Some Internet stores manage to charge prices that are significantly higher than market averages, therefore, obtaining some sort of price premium. This paper is dedicated to building a model that can be used to explain and predict a typical price premium that an Internet store charges for a specific product based on the information about the characteristics of the store and the features of the market for this product. Such models can provide support for pricing and assortment decisions: in particular, they allow detecting products that a store is likely to sell with the highest or the lowest markup based on price premia that are charged by stores with similar characteristics on similar markets
    Keywords: hierarchical linear modeling, e-Commerce, price dispersion
    JEL: L81
    Date: 2014
  5. By: Christophe Benaroya (M&CN - Marketing & Communication Networks - Toulouse Business School); Christine Fèvre-Pernet (Cérep - Centre d'Etudes et de Recherches sur les Emplois et les Professionnalisations - Université de Reims - Champagne Ardenne)
    Abstract: Une très grande variété de travaux académiques porte sur la marque y compris, et plus récemment, dans le domaine business to business. En revanche, probablement considéré comme allant de soi, le processus même d'attribution d'un nom (naming) n'est pas étudié en tant que tel en marketing. En mobilisant les apports de la linguistique principalement et en les combinant aux concepts marketing, cet article à visée exploratoire met en œuvre une approche abductive appliquée aux grands projets industriels. La double démarche adoptée auprès d'experts en marques et noms et d'experts en projets aéronautiques permet de définir plus précisément ici la notion de naming. Est souligné le rôle essentiel du naming pour permettre l'identification, la différenciation et l'authentification d'un projet. Mais, au-delà, les résultats principaux révèlent d'autres fonctions managériales insoupçonnées/ du naming : le nom donne vie au projet (au sens fort du terme) ce qui a pour résultat de mieux fédérer et mobiliser les parties prenantes autour du projet et ainsi d'en faciliter l'organisation et le pilotage.
    Keywords: Abductif; BtoB; Management; Marketing; Marque; Naming; Projet; Onomastique commerciale ; Onomastique des organisations
    Date: 2014–03–28
  6. By: Lubica Hikkerova
    Abstract: The widespread use of loyalty programs in the tourism sector raises questions about their differentiating capacity and more broadly about the real advantages they offer firms. We have chosen to focus on the hotel sector and propose a conceptual model on the determinants of loyalty to a hotel or a hotel chain. The subjacent hypothesis is to determine if a loyalty program and its associated advantages manage to take precedence over other factors which influence choice and thus modify the probability of the hotel being chosen. More precisely, we seek to better understand the antecedents of commitment and trust and look at how these factors influence customer loyalty and thus determine the impact of loyalty schemes. Our empirical study, carried out on a sample group of consumers, enabled us to identify the four antecedents of loyalty (economic value of the exchange, reputation in terms of quality of the firm, communication, and shared values) so as to make managerial recommendations concerning the effectiveness of loyalty programs.
    Keywords: Loyalty; Price; Behaviour; Commitment; Trust; Hotel
    JEL: M1 M3
    Date: 2014–02–25

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