nep-mkt New Economics Papers
on Marketing
Issue of 2015‒10‒17
fourteen papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. Store Brands and the Role of Advertising By Griffith, Rachel; Krol, Michal; Smith, Kate
  2. Price Competition in Product Variety Networks By Ushchev, Philip; Zenou, Yves
  3. Digital Social Visibility, Anonymity and User Content Generation: Evidence from Natural Experiments By Ni Huang; Yili Hong; Gordon Burtch
  4. When Online Engagement Gets in the Way of Offline Sales - A Natural Experiment By Sagit Bar-Gill; Shachar Reichman
  5. A Hedonic Approach Towards Explaining Market Shares of Organic Food - Evidence from Swiss Household Data By Götze, Franziska; Mann, Stefan; Ferjani, Ali; Kohler, Andreas; Heckelei, Thomas
  6. Politique tarifaire locale ou nationale : Quel impact pour le contrôle des concentrations dans le secteur de la distribution ? By Marie-Laure Allain; Claire Chambolle; Stéphane Turolla
  7. Retailer Price Image - An Introduction and Literature Review By Gunnarsson, Jonas
  8. Two faces of word-of-mouth: Understanding the impact of social interactions on demand curves for innovative products By Katarzyna Maciejowska; Arkadiusz Jedrzejewski; Anna Kowalska-Pyzalska; Katarzyna Sznajd-Weron; Rafal Weron
  9. Commitment and Costly Signalling in Decentralized Markets By Derek G. Stacey
  10. Lieber schnell zum Discounter? - Einfluss von Transaktionskosten auf die Einkaufsstättenwahl By Güsten, Stephanie Nadezda; Henkel, Tobias; Möser, Anke
  11. What Marketing Strategy for Sacred Geometry Discoveries to Make Archaeotourism Work? By Mulaj, Isa
  12. How Fragile is the Credibility of a Quality Label? A Quasi-Natural Experiment Using the Example of Stiftung Warentest By Hildenbrand, Andreas; Kühl, Rainer; Piper, Anne
  13. Impact of E-Commerce on Organization Performance; Evidence from Banking Sector of Pakistan By Azeem, Muhammad Mehtab; Ozari, Assit.Prof. Dr.Cidgem; Marsap, Prof.Dr.Akin; Arhab, Prof. Dr.Said; Jilani, Abdul Haseeb
  14. La comestibilité des insectes : étude exploratoire chez les jeunes consommateurs français By Céline Gallen; Gaëlle Pantin-Sohier

  1. By: Griffith, Rachel; Krol, Michal; Smith, Kate
    Abstract: Store brands are products over which a retailer (rather than a manufacturer) takes certain strategic decisions; we study the incentives of a retailer to advertise its store brands. We use detailed data on the British grocery market to document the considerable variation in store brand penetration across product categories and retailers. We develop a model that relates the pricing and advertising decisions of retailers and manufacturers to primitive characteristics of the category, and in particular the way that advertising affects consumer demand. We present empirical evidence that is consistent with several predictions from the model.
    Keywords: advertising; store brands
    JEL: D21 D22 M37
    Date: 2015–10
  2. By: Ushchev, Philip; Zenou, Yves
    Abstract: We develop a product-differentiated model where the product space is a network defined as a set of varieties (nodes) linked by their degree of substituabilities (edges). In this network, we also locate consumers so that the location of each consumer (node) corresponds to her "ideal" variety. We show that there exists a unique Nash equilibrium in the price game among firms. Equilibrium prices are determined by firms' weighted Bonacich centralities and the average willingness to pay across consumers. They both hinge on the network structure of the firm-product space. We also investigate how local product differentiation and the spatial discount factor affect the equilibrium prices. We show that these effects non-trivially depend on the network structure. In particular, we find that, in a star-shaped network, the firm located in the star node does not always enjoy higher monopoly power than the peripheral firms.
    Keywords: monopolistic competition; networks; product variety; spatial competition
    JEL: D43 L11 L13
    Date: 2015–10
  3. By: Ni Huang (Temple University, Fox School of Business, 1801 Liacouras Walk, Philadelphia, PA 19122); Yili Hong (Arizona State University, W. P. Carey School of Business, 400 E Lemon St, Tempe, AZ 85287); Gordon Burtch (University of Minnesota, Carlson School of Management, 321 19th Ave. S., Room 3-368, Minneapolis, MN, 55455)
    Abstract: This study examines how changes in digital social visibility (or conversely, anonymity) can affect the characteristics of user-generated content (volume and linguistic features). We consider natural experiments at two leading online review websites ( and, wherein each was integrated with Facebook. Constructing a unique panel dataset of online reviews for a matched set of restaurants across the two review sites, we estimate a multi-treatment difference-in-differences (DID) model to assess the impact of increased digital social visibility (decreased anonymity). We find that integration with Facebook (and thus greater digital social visibility) increased the volume of user-generated content and consumers’ use of affective language processes, while simultaneously decreasing their use of cognitive language processes and controversial language (e.g., sexually explicit, negative and abrasive words). We discuss the implication of these results as they relate to the creation of a civil, sustainable online social platforms for user generated content.
    Keywords: Natural experiment, text analytics, online reviews, linguistic characteristics, digital social visibility, social network integration, anonymity, difference-in-differences
    JEL: D12 D80
    Date: 2015–10
  4. By: Sagit Bar-Gill (MIT Sloan School of Management, 77 Massachusetts Ave, Cambridge, MA 02139); Shachar Reichman (MIT Sloan School of Management, 77 Massachusetts Ave, Cambridge, MA 02139, and Tel Aviv University, Tel Aviv, 69978, ISRAEL)
    Abstract: The paper studies the effect of online engagement on a brand’s website on offline sales, for a product not available via the online channel. We propose a modelling framework for the online-to-offline funnel, and study the effect of online engagement on purchase decisions. The model highlights both substitution and complementarity between online and offline engagement and sales. We then exploit a natural experiment setting to study the effect of the introduction of a new interactive website by a leading automobile brand on dealership contact and sales. We find evidence for substitution between online and offline engagement, as offline engagement and sales declined following launch of the new website
    Keywords: Online-to-offline, online engagement, natural experiment, sales funnel
    JEL: M31 L19
    Date: 2015–09
  5. By: Götze, Franziska; Mann, Stefan; Ferjani, Ali; Kohler, Andreas; Heckelei, Thomas
    Abstract: The market share of organic food in Switzerland is high compared with that in other European countries, and has grown notably in recent years. However, little is known about why the market share of certain organic food products is higher than that of others. Swiss household expenditure data distinguishing between organic and conventional products allow an analysis at the product level. As a result, factors which determine the market share level of different organic food products are identified. Based on the results of the analysis, the driving factors are categorised into three dimensions. First, a low level of processing is positively related to a high organic market share, suggesting that communicating the benefits of organic food is more successful for unprocessed than for processed products. Second, it appears that the organic consumer in Switzerland is rather critical about buying products that are relatively expensive compared to their conventional counterpart. Products with high price premiums as well as products that are of particular importance for the household in terms of its food budget, therefore, have a clear disadvantage on the market, suggesting that consumers of organic food are price-conscious. Third, Swiss consumers seem to have a high preference for domestically produced organic products, since the characteristic of being an imported product is negatively related to the organic market share level. The results give a first understanding of what is important to Swiss consumers when it comes to the consumption of organic food and imply that supporting organic food production in Switzerland is still promising from a policy perspective as long as the price premium for organic quality stays at a reasonable level.
    Keywords: Consumer Behaviour, Hedonic Analysis, Organic Food, Non-Linear Regression Model, Switzerland, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety,
    Date: 2015
  6. By: Marie-Laure Allain; Claire Chambolle; Stéphane Turolla
    Abstract: [texte en français] The food retail sector is characterized by a competition among multi-market retailers that is highly localized. Multi-store retailers either price discriminate spatially or adopt a uniform pricing strategy among local markets. We analyze theoretically the effects of both pricing strategies (local or uniform) on merger control. We show that when one retailer adopts uniform pricing across stores, the anticompetitive effect of the merger on consumer welfare spreads on markets non directly affected by the merger. In addition, the effect of the merger on directly affected markets is enhanced when these markets are sufficiently more competitive than markets non directly affected by the merger. These results lead to reconsiderate the definition of relevant markets in merger control when one multi-market retailer uses local pricing.
    Keywords: mergers, retail grocery sector, pricing, competition policy
    JEL: L13 L42
    Date: 2015
  7. By: Gunnarsson, Jonas (Marketing and Strategy)
    Abstract: This working paper aims to give an introduction to what we know about what makes up and influences the retailer’s price image: “the general belief about the overall level of prices that consumers associate with a particular retailer” (R. Hamilton & Chernev, 2013). What have been the main themes in academic price image research? The focus is on what relevant empirical evidence has been published and what conclusions can be drawn. We also provide some illustrative new empirical data. The paper is written as a first stop for academic researchers, students and retail practitioners interested in the area. The paper begins by discussing the background and relevance of the topic. We continue the first section by introducing a number of key theoretical concepts that are frequently used in the behavioral pricing and price image literature. We conclude by discussing the crucial role of consumer memory and decision making biases in understanding how consumers process information about retailers, their stores and prices. The empirical section covers many of the issues which in different research streams have been found to be of relevance to understanding how consumers process price information and how they react to cues which retailers attempt to manage every day. The final section attempts to wrap up and visualize the research area.
    Keywords: Price image; price perception; retail prices; grocery; Sweden; pricing strategy; branding; positioning
    Date: 2015–08–01
  8. By: Katarzyna Maciejowska; Arkadiusz Jedrzejewski; Anna Kowalska-Pyzalska; Katarzyna Sznajd-Weron; Rafal Weron
    Abstract: Word-of-mouth (WOM) is a puzzling phenomenon. It strongly influences the innovation diffusion process and is responsible for the 'S' shape of the adoption curve. However, it is not clear how WOM affects demand curves for innovative products and strategic decisions of producers. In this paper, we build an agent-based model of innovation diffusion, which links the opinions of potential consumers with their market behavior via the concept of reservation prices. We show that when reversibility of opinions is allowed, WOM may have either a positive or a negative effect on the adoption process, depending on the model parameters and the level of market prices. Our results suggest that a relatively strong WOM effect can lead to the creation of two separated price-quantity regimes, with a nonlinear transition between them. A small shift of the market price can result in a drastic change of the demanded quantity and, hence, the revenues of a firm. Using Monte Carlo simulations and mean-field (semi-)analytical treatment we demonstrate that WOM may have ambiguous consequences and should be taken into account when designing marketing strategies.
    Keywords: Word-of-mouth; Innovation diffusion; Agent-based model; Demand curve; Marketing strategy
    JEL: C63 O33 Q48 Q55
    Date: 2015–10–04
  9. By: Derek G. Stacey (Department of Economics, Ryerson University, Toronto, Canada)
    Abstract: I propose a model of a decentralized market using a search framework with asymmetric information in which sellers are unable to commit to asking prices announced ex ante. Relaxing the commitment assumption prevents sellers from using price posting as a signalling device to direct buyers' search. Private information about the gains from trade and inefficient entry on the demand side then contribute to market illiquidity. Endogenous sorting among costly marketing platforms can facilitate the search process by segmenting the market to alleviate information frictions. Seemingly irrelevant but incentive compatible listing fees are implementable as long as the market is not already sufficiently active. The theoretical implications are qualitatively consistent with the empirical observations of real estate brokerage in housing markets: listing fees, platform differentiation, and endogenous sorting based on seller motivation.
    Keywords: Search, Costly Signalling, Efficiency, Housing
    JEL: C78 D40 D44 D83 R31
    Date: 2014–12
  10. By: Güsten, Stephanie Nadezda; Henkel, Tobias; Möser, Anke
    Abstract: Der Discounter ist der Deutschen liebste Lebensmitteleinkaufsstätte – trotz zahlreicher Alter-nativen. Warum also sind Discounter so beliebt? In einem theoretischen Überblick werden zunächst Entscheidungskriterien herausgearbeitet, die die Wahl einer Einkaufsstätte beein-flussen, mit besonderem Augenmerk auf Transaktionskosten. Da Lebensmittel als „fast moving consumer goods“ (FMCG) vom Verbraucher regelmäßig und wiederkehrend nachge-fragt werden, spielt neben den Transaktionskosten das Image der Einkaufsstätte vermutlich eine große Rolle. Die vorliegende Studie zeigt, dass deutsche Verbraucher dem Discounter im Vergleich zu anderen Betriebstypen ein negatives Image zuschreiben. Aus transaktionskostentheoretischen Gesichtspunkten ist die Wahl des Discounters als Haupteinkaufsstätte dennoch vorteilhaft. Die empirische Analyse belegt einerseits, dass anscheinend „out-of-pocket“-Kosten, gemessen als Entfernung zum Wohnort, im Super- oder Verbrauchermarkt und Discounter geringer sind als in den anderen Betriebstypen. Kunden des Discounters schätzen andererseits, neben den günstigen Preisen, vor allem die Möglichkeit, einen schnellen Einkauf zu tätigen, d.h. die wahrgenommenen Transaktionskosten werden vom Verbraucher niedriger eingeschätzt als in den anderen Betriebstypen.
    Keywords: Einkaufsstättenwahl, Transaktionskosten, multinominale Regression, Consumer/Household Economics, Marketing,
    Date: 2015
  11. By: Mulaj, Isa
    Abstract: Archaeotourism can take place in two main forms: i) on site or locations of discoveries; and ii) assembling the discoveries into museums or exhibitions. Given that the first option in Kosovo has not proven viable, a marketing strategy went on to be explored for the latter in broad terms by taking into account Bronze Age artifacts with engravings from the sacred geometry discovered by the Author of this paper during 2013-14, which were the work of ancient Illyrians. Yet, the results suggest a third alternative of archaeotourism development, and that is the interest by respective foreign scholars, institutions, and foundations by using Long Tail marketing approach. The paper interprets some astrological metaphors of sacred geometry in literature review, but draws conclusions from archeological discoveries.
    Keywords: Kosovo, Bronze Age, sacred geometry, archaeotourism, marketing strategy
    JEL: M31 Q57 Z11
    Date: 2015–10–11
  12. By: Hildenbrand, Andreas; Kühl, Rainer; Piper, Anne
    Abstract: In 2013, Stiftung Warentest tested hazelnut chocolate for their leading magazine, called Test. Stiftung Warentest is one of the most important consumer organizations in Germany. Ritter Sport is a high-quality producer of chocolate in Germany. Their hazelnut chocolate did not pass the test. It was given the grade of unsatisfactory. Stiftung Warentest accused Ritter Sport of labeling an artificial flavoring as a natural flavoring. Ritter Sport rejected the accusation. They went to court and won the trial. Using the Ritter Sport versus Stiftung Warentest case, we analyze whether negative headlines really undermine the credibility of a quality label by examining Stiftung Warentest and their Test label. In addition, we examine what can be done to restore or, more generally, increase the credibility of a quality label. Based on a quasi-natural experiment, we find that the negative headlines on Stiftung Warentest have undermined the credibility of the Test label. We also find that the credibility of the Test label can be restored by providing reference values to the tests, strengthening the independence of Stiftung Warentest, and using laboratory methods in the tests.
    Keywords: information (D8), product quality (L1), quality label, source credibility (M3), Food Consumption/Nutrition/Food Safety, Institutional and Behavioral Economics, Marketing,
    Date: 2015
  13. By: Azeem, Muhammad Mehtab; Ozari, Assit.Prof. Dr.Cidgem; Marsap, Prof.Dr.Akin; Arhab, Prof. Dr.Said; Jilani, Abdul Haseeb
    Abstract: In the recent years, E-banking is one of the most important revolutions in the banking sector of Pakistan. This study measures the impact of e commerce (B2B, B2C, C2C) on organization performance (Business operation, Job performance, Customer satisfaction).The sample of this research is collected from the banking sector of Pakistan from the period of 6 to 8 months by using 50 samples filling online from the period 2012 to 2013. Results show that there is positive relationship between e-commerce and organization performance and by implementing e commerce; organizations improve its performance in terms of business operations, job performance and customer satisfaction. Major research has been withdrawn from MBA thesis subject Impact of foreign banks on domestic banks businesses.
    Keywords: Electronic commerce, organization performance, business to business, business to customer, customer to customer.
    JEL: E5
    Date: 2015–06
  14. By: Céline Gallen (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - UN - Université de Nantes); Gaëlle Pantin-Sohier (Granem - Groupe de Recherche ANgevin en Economie et Management - UA - Université d'Angers - Agrocampus Ouest - Institut National de l'Horticulture et du Paysage)
    Abstract: La consommation d’insectes représente des enjeux nutritionnels, économiques et écologiques à l’échelle mondiale mais fait face à de nombreux freins dans le monde occidental. L’objectif de cet article est d’explorer la comestibilité des insectes en France par l’étude les représentations mentales des insectes et de l’entomophagie. Une étude qualitative menée auprès de 37 jeunes adultes (20-30 ans) permet de mettre en lumière les freins et motivations liés à la consommation d’insectes, les types d’insectes les moins rejetés, les formes et préparations les mieux acceptées ainsi que les informations pouvant favoriser leur consommation chez ces « early adopters ». Ces résultats visent à éclairer les fabricants sur les produits à concevoir et les informations à communiquer pour faire accepter les insectes comme culturellement comestibles en France.
    Keywords: Entomophagie , insectes , comestibilité , dégoût , représentations , ambivalences alimentaires.
    Date: 2015–10–02

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