nep-mkt New Economics Papers
on Marketing
Issue of 2014‒12‒24
twelve papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. Welfare Analysis of Dynamic Voluntary Advertising in Covered Markets By Tenryu, Yohei; Kamei, Keita
  2. Le seuil d'entrée du point de vente : identification des principaux types d'entrées et des stratégies d'appropriation de l'espace par les consommateurs By Scordel, Maggie
  3. Alternative Food Networks in Piedmont: determinants of on-farm and off-farm direct sales by farmers. By Corsi, Alessandro; Novelli, Silvia; Pettenati, Giacomo
  4. A National Survey of Consumer Preferences for Branded Gulf Oysters and Risk Perceptions of Gulf Seafood By Petrolia, Daniel R.; Walton, William C.; Sarah, Acquah
  5. Réponses des consommateurs à la suppression des suremballages sur les MDD By Monnot, Elisa; Reniou, Fanny; Parguel, Béatrice
  6. Shrinking Goods By Levy, Daniel; Snir, Avichai
  7. Public regulatory intervention in consumer-friendly firms By Vitor Miguel Ribeiro
  8. Consumer payment choices : Room for further digisation? By Kosse, J.C.M.
  9. On firm choice between online and physical markets By Yijuan Chen; Xiangting Hu; Sanxi Li
  10. A short note on expected risk adjusted elasticity and consumer theory By José P. Dapena
  11. Environmental protection between social responsibility, green investments and cultural values By Andrei, Jean; Panait, Mirela; Ene, Corina
  12. Road pricing: An overview By M. Rouhani, Omid

  1. By: Tenryu, Yohei; Kamei, Keita
    Abstract: In this study, we analyze a dynamic duopoly game in which firms can use advertising and price as competitive tools. The market is assumed to be completely covered in the sense that all consumers purchase a product from one of the two firms. We assume that advertising creates a positive externality. Thus, each firm voluntarily advertises to persuade consumers to buy its products over those of the other firm, even though the firms compete with one another in price. Two cases are considered: an interior case and a corner case. In this situation, we investigate how changes in consumer preference and firm technology level affect advertising, profits, and economic welfare and highlight the differences between the two cases.
    Keywords: Advertising, vertical product differentiation, differential games, duopoly.
    JEL: C72 L13 M37
    Date: 2014–12
  2. By: Scordel, Maggie
    Abstract: The store entrance design reveals for retailers a choice between an easy access which can increase store traffic and a more selective access that encourages consumer involvement and experience in a brand universe. The aim of this research is to identify the main types of stores entrances and consumer’s appropriation strategies. The results highlight through a typology four types of stores entrances (free entrance, bounded entrance, progressive entrance, and selective entrance) which allow specific appropriation strategies for consumers (functional strategies and ludic strategies).
    Keywords: Distribution; Aménagement spatial; Expérience; Retail; Spatial organisation; Appropriation; Experience;
    JEL: L81 M31
    Date: 2014–10
  3. By: Corsi, Alessandro; Novelli, Silvia; Pettenati, Giacomo (University of Turin)
    Abstract: Direct sales are a widespread and important typology of the so-called Alternative Food Networks. The direct links between producers and consumers can take two basic forms: consumers going to buy agricultural products at the farm (on-farm sales), and farmers selling their products in urban areas. These practices are an alternative to traditional organizations of the agro-food chains, that typically involve several operators between producers and consumers. It is therefore important to analyse the reasons pushing farmers to adopt this new organization of their marketing chain. This research aims at analysing the territorial distribution of direct links between urban consumers and farmers in Piedmont (Italy), and to assess the main determinants of their choice. Firstly, the territorial distribution of direct sales practices (on-farm or elsewhere) is analysed. This is made possible by the access to micro-data from the 2010 Agricultural Census for Piedmont, a region whose agriculture is characterized by a strong emphasis on quality products. The farms that chose direct sales, both on-and off-farm, are mostlyconcentrated in specific clusters, such as the hilly wine-growing areas of Langhe and Monferrato, the hilly belt surrounding Torino, and some low Alpine valleys. Secondly, we analyse the determinants of the choice to sell directly to consumers, separately for on-farm and off-farm sales, with probit models. Explanatory variables comprise the structural characteristics of the farms (farm size, type of farming, etc.), the personal characteristics of the operators and of the farm households, and the proximity to urban and commercial areas. Operators’ and farm characteristics are found to affect the choice of selling directly, but rather weakly. The most important factors affecting these choices are farm location and, for on-farm direct sales, the complementarity with agro - tourism and recreational activities.
    Date: 2014–12
  4. By: Petrolia, Daniel R.; Walton, William C.; Sarah, Acquah
    Abstract: Three restaurant taste panels and an online consumer survey were conducted during 2012-2013 to assess whether Gulf consumers would be willing to pay a premium for place-name specific (i.e., “branded”) Gulf oysters over typical “generic” Gulf oysters, and whether consumers in other U.S. markets would be willing to pay for branded Gulf oysters compared to other U.S. branded oysters. Panelists in the two Gulf Coast taste panels had strong preferences for local oyster varieties when they were aware of oyster variety names and harvest locations (i.e., during labeled rounds). In the absence this information (i.e., during blind rounds), panelists had no such preferences, and in the case of the Houston taste panel, actually had a significant distaste for the local Galveston Bay variety. Panelists in the Chicago taste panel had strong preferences for the Island Creek oyster, in both the blinded and labeled rounds, although during the labeled rounds, the Point aux Pins oysters fared equally well (statistically) to the Island Creeks. Additionally, during the labeled rounds, the Apalachicola Bay and Point aux Pins oysters were statistically more likely to be chosen over the San Antonio Bay oysters. Respondents to the online survey tended to have higher perceptions of quality and seafood safety regarding their own regionally-produced oysters relative to oysters from other regions. There was limited variation in perceptions from one Gulf Coast variety to another, with the exception of the Apalachicola Bay variety being rated higher in several cases, and the more general “Gulf of Mexico” category being rated lower. Online survey results indicate that, consumers living in eastern Gulf states such as Georgia and Florida may be willing to pay a premium for branded Gulf oysters, particularly oysters from Florida and Louisiana. Gulf consumers living in Alabama, Mississippi, Louisiana, and Texas, however, did not show any strong preferences for branded oysters relative to cheaper generic ones. Among non-Gulf consumers, survey results indicate that while a price discount may be needed to sell branded Gulf oysters relative to local oysters (i.e., relative to, say, East Coast oysters in East Coast markets), that Gulf oysters generally fared no worse than other non-local oysters (i.e., West Coast oysters in East Coast markets). Of the Gulf oysters tested, Atlantic Coast respondents appear to prefer Louisiana oysters. Pacific Coast respondents appear to be indifferent between most Atlantic Coast and Gulf Coast varieties. Also, it appears that relatively few respondents were concerned about the Deepwater Horizon oil spill when answering questions about oysters, although these concerns did affect preferences for Gulf Coast oysters negatively in some cases. Less than 1% of all respondents indicated any concern regarding Vibrio vulnificus, bacteria, or similar. However, such concerns, though not cited explicitly, may yet be latent in the reported perceptions of oysters from various Gulf Coast locations. These results would indicate that there is some room for opportunity for branded Gulf Coast oysters along these other two coasts in places where other non-local oysters are marketed successfully. The major challenge appears to be whether the price discount necessary to entice consumers in these other markets to buy Gulf Coast oysters relative to local varieties is yet sufficiently high as to remain a profitable enterprise for Gulf Coast producers. The price discounts estimated here in the range of $5-$10 per half-dozen sounds like a steep discount, but given the large differential in retail prices in Atlantic and Pacific markets - where oysters retail anywhere from $15 to $25 per half-dozen-- compared to Gulf Coast markets – where they retail in the neighborhood of $7 to $10 -- it is possible that even with the discounts, the prices received in these alternative markets may remain profitable.
    Keywords: branding, choice experiment, food safety, oysters, risk, taste panel, Consumer/Household Economics, Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, Marketing, C93, D12, M31, Q13, Q22, Q26,
    Date: 2014–11
  5. By: Monnot, Elisa; Reniou, Fanny; Parguel, Béatrice
    Abstract: Could eliminating overpackaging from private labels be a lever for a responsible positioning without any effect on purchase intention? Drawing on the attribution theory framework, this research uses an experiment on 217 French respondents and shows that eliminating overpackaging does have an influence on mimic private labels’ ecological image, but damages their purchase intention through the mediating effect of perceived quality and convenience. It has however no influence on generic private labels’ purchase intention.
    Keywords: Suremballage; Emballage; MDD; Image de marque; Comportement du consommateur; Over-packaging; Packaging; Private label; Product image; Consumer behavior;
    JEL: D11 D12 M31
    Date: 2014–10
  6. By: Levy, Daniel; Snir, Avichai
    Abstract: If producers have more information than consumers about goods’ attributes, then they may use non-price (rather than price) adjustment mechanisms and, consequently, the market may reach a new equilibrium even if prices don't change. We study a situation where producers adjust the quantity per package rather than the price in response to changes in market conditions. Although consumers should be indifferent between equivalent changes in goods' prices and quantities, empirical evidence suggests that consumers often respond differently to price changes and equivalent quantity changes. We offer a possible explanation for this puzzle by constructing and empirically testing a model in which consumers incur cognitive costs when processing goods’ price and quantity information.
    Keywords: Quantity Adjustment,Cognitive Costs of Attention,Information Processing
    JEL: L11 L15 L16 M21 M31 M37 M38 K20 E31 D21 D22 D40 D83
    Date: 2013–01–22
  7. By: Vitor Miguel Ribeiro (Vitor Miguel Ribeiro - FEP - Vitor Miguel de Sousa Ribeiro)
    Abstract: We study a duopoly with differentiated and substitutable goods composed of one consumer-friendly firm and one pure-profit maximizing firm. In such a duopoly, a regulatory authority intervenes to control the degree of altruism of the consumer-friendly firm. We conclude that under quantity competition, if firms sell goods that are too homogeneous the policymaker should impose a ceiling on the level of benevolence of the consumer-friendly firm. However, under price competition, the policymaker never imposes a ceiling on the level of kindness of the consumer-friendly firm. Our results also show that, whatever the degree of product differentiation, the social welfare under price competition is always higher than the social welfare under quantity competition, which restores the arguments pointed out by the traditional literature and constitutes a sharp contrast with Nakamura (2013).
    Keywords: Consumer-Friendly Firm, Product Differentiation, Public Intervention
    JEL: D43 L11 L13 R12
    Date: 2014–11
  8. By: Kosse, J.C.M.
    Abstract: There is a large variety of instruments that consumers can use for making payments. The use of electronic payment instruments, such as payment cards and online transfers, has considerably increased over the past decades. Yet, consumers still heavily rely on cash and other paper-based means of payment. The objective of this thesis is to examine the drivers underlying consumers’ choice of which payment instruments to use for their transactions. More specifically, in three empirical studies, this thesis examines how consumers’ payment choices are influenced by foreign backgrounds and by payments safety. However, as having accurate data on the use of payment instruments is key to assessing the drivers underneath, this thesis first takes one step back and provides a profound analysis of how to best measure consumers’ payment behaviour, and in particular their use of cash.
    Date: 2014
  9. By: Yijuan Chen; Xiangting Hu; Sanxi Li
    Abstract: Consumers buying goods online often cannot physically inspect the products prior to purchase. Thus an online market may turn what is usually regarded as a search good into an experience good. We investigate how this feature, together with other features of the marketplace, affects a firms choice between online and physical markets. Using a simple yet flexible framework, we show that the choice of a marketplace can be used to disclose or hide product quality. If the production cost is convex with respect to quality, the firm's choice will be characterized by a cutoff quality level, below which the firm will choose the online market, and above which the firm will choose the physical market. However, if the production cost of quality is concave, there are situations where the highest qualities pool with the lowest ones in the online market, leaving the physical market to intermediate qualities.
    JEL: L15 D83
    Date: 2014–08
  10. By: José P. Dapena
    Abstract: This short note is aimed to open discussion. Asset pricing models assume capital markets are competitive, but then my questions were: Why would a diversified investor be willing to accept a supposedly lower equilibrium risk adjusted rate of return in emerging markets (like Argentina), that the one sought from a foreign investor, being both comfortable with it? The second: Do the sale of securities and finance in general benefit from, applying concepts and tools borrowed from consumer theory and particularly demand theory? Finally: May companies benefit from some sort of market power when selling risk to investors in the form of securities (particularly shares), in the same way they may benefit from holding market power for their products and services? The purpose of this short note is to share debate about the assumption of competitive markets in the determination of the equilibrium risk adjusted rate of return, which could become more interesting in emerging markets where lack of depth of capital markets, lack of information and lack of sophistication are more plausible to find giving rise to the possibility of sort of market power in the sale of risk, and to perhaps introduce some points of contact between the consumer theory -particularly demand and marketing (which holds for consumption of current products and services), to securities (particularly in this note herein shares) which are no more than packed rights for future consumption. However, concepts may apply to developed capital markets where companies want to promote not only their products and services, but also their shares.
    Keywords: Asset valuation, rate of return, competitive markets, price elasticity, consumer theory
    JEL: F36 G11 G12
    Date: 2014–12
  11. By: Andrei, Jean; Panait, Mirela; Ene, Corina
    Abstract: In a well functional and competitive economy all the entrepreneurs are aware of the importance of protecting the environment, development of local communities and the good relations with stakeholders. The necessity imposed by a sustainable development has many influences on the company’s activities because in order to equilibrate their profit`s motivation with their social and environment implications. This article is focused on the way of different investors integrated in their strategies the environment preoccupations. The actions of companies are shaped by different stakeholders like consumers, public authorities, shareholders, international organizations and other entities.
    Keywords: Environment, cultural values, stakeholders, consumers, corporate social responsibility, green investment
    JEL: A1 M1 Q01
    Date: 2014–11–12
  12. By: M. Rouhani, Omid
    Abstract: This paper offers a general overview of the road pricing concept. It first examines the common objectives used in road pricing, namely (a) congestion reduction; (b) raising profits; (c) social welfare maximization; etc. Then, it explores various types of road pricing, including two major ones: (1) road tolls and (2) congestion pricing charges. Next, general modeling approaches used for estimating the impacts of road pricing are discussed. Finally, the paper concludes with a checklist explaining how to promote a successful road pricing scheme.
    Keywords: road pricing, congestion pricing, congestion reduction, profit maximization, road tolls.
    JEL: L91 R4 R41 R48
    Date: 2014–11–03

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