nep-mkt New Economics Papers
on Marketing
Issue of 2015‒11‒07
fifteen papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. Willingness to Pay for Quality Attributes of Fresh Beef Implications on the Retail Marketing By Berges, Miriam; Casellas, Karina; Rodriguez, Ricardo; Errea, Damian
  2. How To Sell A Condom? The Impact Of Demand Creation Tools On Male And Female Condom Sales In Resource Limited Settings By Fern Terris-Prestholt; Frank Windmeijer
  3. Who Buys from Farmers' Markets and Farm Shops: The Case of Germany By Bavorova, Miroslava; Gailhard, Ilkay; Lehberger, Mira
  4. Information, Branding, Certification, and Consumer Willingness to Pay for High-Iron Pearl Millet: Experimental Evidence from Maharashtra, India By Banerji, Abhijit; Birol, Ekin; Karandikar, Bhushana; Rampal, Jeevant
  5. Indian Acceptance of Cisgenic Rice: Are all GMOs the same? By Shew, Aaron M.; Nalley, Lawton L.
  6. Streaming Reaches Flood Stage: Does Spotify Stimulate or Depress Music Sales? By Luis Aguiar; Joel Waldfogel
  7. CONSUMEREX – Consumer Experience Model. A multidimensional model of services evaluation. Application in the sport context. By João Diogo; Cesaltina Pires; Leonor Vacas de Carvalho
  8. The role of public information in corporate social responsibility By Aleix Calveras; Juan José Ganuza
  9. Assessing the Value of Quality in the Italian Wine Market By Cacchiarelli, Luca; Carbone, Anna; Esti, Marco; Laureti, Tiziana; Sorrentino, Alessandro
  10. Signalling Origin: Consumer Willngness to Pay for Dairy Products with the "100% Canadian Milk" Label By Forbes-Brown, Shelicia; Mcheels, Eric; Hobbs, Jill
  11. An Evaluation of Factors Affecting Drug Quality: Evidence from the Antimalarial Market in Uganda By Esther Atukunda; Anne Fitzpatrick
  12. A multi-criteria stated method to analyze consumers’ preference and sensory evaluation towards omega-3 enriched eggs: The Analytical Hierarchy Process (AHP) By Baba, Yasmina; Kallas, Zein; Realini, Carolina
  13. Opportunities to profit under competitive market conditions: The case of the Macedonian wineries By Georgiev, Nenad; Gjosevski, Dragon; Simonovska, Ana; Nacka, Marina
  14. Movies, Margins and Marketing: Encouraging the Adoption of Iron-Fortified Salt By Abhijit Banerjee; Sharon Barnhardt; Esther Duflo
  15. Tri-Factorial Structure of Safety-Related Internal Communication (SRIC) within an Air Navigation Service Provider Framework: Assessment of a Second-Order CFA Model in Portugal By Cristina Félix Pereira; Ana Sampaio; Fátima Jorge

  1. By: Berges, Miriam; Casellas, Karina; Rodriguez, Ricardo; Errea, Damian
    Abstract: In recent decades, the demand for food worldwise has undergone significant changes that have highlighted the issue of the quality and safety of food consumed. After international food crisis associated with consumption of fresh meat, consumer concerns about the quality and safety of these products has been increased. However, the atrribtures for assessing the safety of fresh meat consumption are not firectly observable; they are credence attributes. The aim of this work is to investigate consumers' preceptions of safety in Argentina and identify factors that help expalin consumers' willingness to pay for different attributes related safety of the beef products, including, a hypothetical hygiene certification in handling and retailing. The results indicate a positive willingness to pay for fresh meat atrributes such as personalized attention in a butcher counter, the presense of a "safety certification" in the place of purchase and the bright red color on the product.
    Keywords: Agricultural Finance, Food Consumption/Nutrition/Food Safety, Marketing,
    Date: 2015
  2. By: Fern Terris-Prestholt; Frank Windmeijer
    Abstract: Despite condoms being cheap and effective in preventing HIV, there remains an 8 billion shortfall in condom use in risky sex-acts. Social marketing organisations apply private sector marketing approaches to sell public health product. This paper investigates the impact of marketing tools, including promotion and pricing, on demand for male and female condoms in 52 countries between 1997 and 2009. A static model differentiates drivers of demand for male and female condoms, while a dynamic panel data estimator estimates their short- and long-run impacts. Products are not equally affected: female condoms are not affected by advertising, but highly affected by interpersonal communication and HIV prevalence. Promotion has significant short- and long-run effects on both condoms. Price changes have a large impact on the short- and long-run female condom demand, but only affect long-run male condom demand. Programming for HIV prevention technologies needs to consider both product and target population characteristics.
    Keywords: advertising, consumer demand, HIV prevention, dynamic panel data estimators, condoms, low and middle income countries
    JEL: L1
    Date: 2015–10
  3. By: Bavorova, Miroslava; Gailhard, Ilkay; Lehberger, Mira
    Abstract: In this article, we analyze the influence of socio-demographic factors and consumer attitudes toward direct marketing products and sources (outlets) on the frequency of buying food from farmers’ markets and farm shops. By conducting an intercept survey with pedestrians in 2011 and 2012, we interviewed a total of n=550 consumers. The target regions of the study were the Eastern German federal states. The study employs two ordered logit regression models to investigate consumers’ shopping behavior at farmers’ markets and farm shops separately. We find that different factors significantly influence consumers’ buying behavior at the two direct marketing outlets. Specifically, both a more favorable view toward the freshness of directly marketed foods and the intention to support local producers are positively related to consumers’ purchase frequency from farmers’ markets. In contrast, consumers’ purchase frequency from farm shops is significantly influenced by their perception of the cost of the products, confidence in food producers of directly marketed products, perception of the safety of the food and perception of the accessibility of farm shops. The study results indicate that considering consumer behavior separately for different direct marketing channels for food rather than considering the entire category of local food outlets may provide new and valuable insights.
    Keywords: Agribusiness, Agricultural Finance,
    Date: 2015
  4. By: Banerji, Abhijit; Birol, Ekin; Karandikar, Bhushana; Rampal, Jeevant
    Abstract: In this paper we use sensory evaluation methods and Becker-DeGroot-Marschak mechanism to estimate consumer demand for biofortified high-iron pearl millet (HIPM) in Maharashtra, India. Unlike biofortification with provitamin A, biofortification with iron and zinc, does not change the color of the biofortified crop. Therefore, we test the impact of both nutrition information, and branding and certification, as well as the nature of the brand and of the certifying authority (state level versus international), on consumer demand for HIPM. We find that even in the absence of nutrition information, consumers assign a small but significant premium to the HIPM variety relative to the local variety. This is consistent with consumers’ more favorable rating of the sensory characteristics of the high-iron variety. Nutrition information on the health benefits of HIPM increases this premium substantially, and regression analysis reveals that consumers prefer international branding and certification authority to their state-level counterparts.
    Keywords: biofortification, high-iron pearl millet, Becker-DeGroot-Marschak mechanism, Crop Production/Industries, C35, C93, D12, D83, Q18,
    Date: 2015
  5. By: Shew, Aaron M.; Nalley, Lawton L.
    Abstract: India has more than 215 million food insecure people, many of whom are farmers. Genetically modified (GM) crops have the potential to alleviate this problem by increasing food supplies and strengthening farmer livelihoods. For this to occur, two factors are critical: (1) a change in the regulatory status of GM crops, and (2) consumer acceptance of GM foods. There are generally two classifications of GM crops based on how they are bred: cisgenically-bred, derived from sexually compatible organisms, and transgenically-bred, derived from sexually incompatible organisms. Consumers may view cisgenic foods as more natural than those produced via transgenesis, thus influencing consumer acceptance. This premise was the catalyst for our study—would Indian consumers accept cisgenically-bred rice and if so, how would they value cisgenics compared to conventionally-bred rice, GM-labeled rice, and “no fungicide” rice? In this willingness-to-pay study, respondents did not view cisgenic and GM rice differently. However, participants were willing-to-pay a premium for any aforementioned rice with a “no fungicide” attribute, which cisgenics and GM could provide. Lastly, 76% and 73% of respondents stated a willingness-to-consume GM and cisgenic foods, respectively.
    Keywords: Cisgenesis, GMO, Consumer Acceptance, Rice, Food Security, India, Crop Production/Industries, Food Security and Poverty, International Development, D8, O3,
    Date: 2015–11
  6. By: Luis Aguiar (European Commission - JRC - IPTS); Joel Waldfogel (University of Minnesota - Carlson School of Management)
    Abstract: Streaming music services have exploded in popularity in the past few years, variously raising optimism and concern about their impacts on recorded music revenue. On the one hand, streaming services allow sellers to engage in bundling with the promise of increasing revenues, pro_ts, and consumer surplus. Successful bundling would indeed translate some of the interest in music not generating revenue through individual track sales - unpaid consumption and deadweight loss - into willingness to pay for the bundled o_ering. On the other hand, streaming may displace traditional individual track sales. Even if they displace sales, streams may however still raise overall revenue if the streaming payment is large enough in relation to the extent of sales displacement. We make use of the growth in Spotify use during the years 2013-2015 to measure its impact on unpaid consumption and on the sales of recorded music. We find that Spotify use displaces permanent downloads. In particular, 137 Spotify streams appear to reduce track sales by 1 unit. Consistent with the existing literature, our analysis also shows that Spotify displaces music piracy. Given the current industry's revenue from track sales ($0.82 per sale) and the average payment received per stream ($0.007 per stream), our sales displacement estimates show that the losses from displaced sales are roughly outweighed by the gains in streaming revenue. In other words, our analysis shows that interactive streaming appears to be revenue-neutral for the recorded music industry.
    Keywords: Music Streaming, Music Industry, Copyright
    JEL: K42 L82 O34 O38
    Date: 2015–05
  7. By: João Diogo (University of Évora, PhD Student and CEFAGE, Portugal); Cesaltina Pires (University of Évora, Department of Economics and CEFAGE, Portugal); Leonor Vacas de Carvalho (University of Évora, Department of Management, Portugal)
    Abstract: This paper proposes a new service evaluation model: Consumerex – Consumer Experience Model. The model integrates theoretical advances from the fields of service marketing and relationship marketing and uses a multidimensional approach to assess all constructs that typically are considered in the evaluation of a service: quality, satisfaction, perceived value, and loyalty. Moreover, the model includes new sub-dimensions such experiential quality and experiential satisfaction, which are expected to be particularly relevant in services where customers are co-producers. The application of the model in the context of sport marketing is suggested.
    Keywords: Services Marketing; Relationship Marketing; Sport Marketing; Quality; Satisfaction; Value; Behavioral intentions; Loyalty.
    Date: 2015
  8. By: Aleix Calveras; Juan José Ganuza
    Abstract: Many of the attributes that make a good 'socially responsible' are credence attributes that cannot be learned by consumers either through search or experience. Consumers, then, use for their purchasing decisions 'noisy' information about these attributes obtained from potentially contradictory channels (media, advertisement, NGOs). In this paper we model such informational framework and show the positive relationship between the accuracy of the information transmitted to consumers and corporate social responsibility (CSR). We also show that a firm may be tempted to add noise to the information channel (through lobbying of the media), which might reduce the supply of the CSR attributes and even harm the firm itself (with lower profits). It might then be profitable to the firm to commit ex-ante to not manipulate the information regarding the firm's business practices (e.g., with a partnership with an NGO). Finally, we extend our model to a competition framework endogenizing the number of firms active in the CSR segment. We show both that in more transparent markets a larger number of firms will be CSR, and that in a market with more intense competition, a higher degree of transparency is required in order to sustain a given number of CSR firms.
    Keywords: credence good, information asymmetry, corporate social responsibility, regulation, NGO, competition.
    JEL: D72 H42 L51 M14 Q52
    Date: 2015–02
  9. By: Cacchiarelli, Luca; Carbone, Anna; Esti, Marco; Laureti, Tiziana; Sorrentino, Alessandro
    Abstract: The paper aims at: i) understanding to what extent wine experts’ evaluations are influenced by different quality clues ii) assessing the role and effectiveness of different quality clues in the creation of price. To meet these goals we set two independent equations. The first -estimated via an ordered logit- explaining the score obtained by each wine with a bunch of attributes of the wine and of its production process. The second equation is a hedonic price model –estimated via an interval regression- where price is a function of a large number quality clues. The analysis covers 2,523 wines from three Italian Regions as reviewed by Veronelli guide. Results indicates that: i) few attributes seems to systematically impact experts’ judgments; ii) many quality clues are associated with significant price premiums; iii) in some cases consumers give value to quality clues along with experts while in other cases there is no alignment.
    Keywords: hedonic price, quality clues, experts’ evaluation, interval regression, ordered logit model, Food Consumption/Nutrition/Food Safety, International Development, D400,
    Date: 2015
  10. By: Forbes-Brown, Shelicia; Mcheels, Eric; Hobbs, Jill
    Abstract: In Canada, all fluid milk and cream products must be sourced from Canadian producers under the supply management policy governing the Canadian dairy sector, while other processed dairy products, such as cheese, yogurt, and ice cream can be made using imported milk components. Recently, the Dairy Farmers of Canada launched a 100% Canadian Milk label for products that contain only milk and milk ingredients produced in Canada. This paper uses a Discrete Choice Experiment from a Canada-wide survey of dairy consumers to elicit their willingness-to-pay for ice cream carrying the 100% Canadian Milk label. The results show that Canadian consumers are willing to pay more for ice cream products that carry the label. Consumer knowledge of the dairy sector affects their willingness to pay for this labelling information. Implications for the use of the Canadian origin label and suggestions for further research are discussed.
    Keywords: Willingness to Pay, Ice cream, Stated Preference, Country of Origin, Random Parameters Logit (RPL) model, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety, Q13, Q17,
    Date: 2015
  11. By: Esther Atukunda; Anne Fitzpatrick
    Abstract: The quality of healthcare, and specifically medicines, is reportedly low in developing countries. We purchase and test 879 antimalarial drugs from 459 outlets in 44 randomly selected parishes (131 villages) in Uganda to estimate the average rate of drug quality. We focus on artemether-lumefantrine (AL), the first-line treatment for malaria in Uganda. Purchased drugs are tested for quality using a handheld spectrometer. Our methodology allows us to differentiate between counterfeit and substandard drugs; counterfeit drugs are different than a high quality drug of the same brand, while substandard drugs are different and also likely medically ineffective. Data are then linked to surveys of drug vendors at the same outlets to test hypotheses of how low quality drugs arrive at market. In contrast to previous literature, we find that AL is widely available and drug quality is relatively high in the study area. While 17% of samples are counterfeit, only 3.4% of purchased drugs are substandard. We subsequently establish three new empirical facts regarding low-quality drugs. First, substandard drugs are typically dilutions of high quality doses, rather than dosages of all ineffective tablets. Dilution increases noise and makes it more difficult for customers to recognize when they have been sold a substandard dosage. Second, we show that counterfeit dugs are priced slightly lower, but substandard drugs are priced the same as high quality drugs. These results are consistent with consumer deception as opposed to a low willingness to pay for quality. Third, a small percentage of vendors are complicit in selling deceptively ineffective medicines. However, identifying which vendors and outlets sell low-quality medicines is difficult.
    JEL: D8 I15 L15
    Date: 2015–10
  12. By: Baba, Yasmina; Kallas, Zein; Realini, Carolina
    Abstract: The appropriateness of the Analytical Hierarchy Process (AHP) technique to analyze consumers’ acceptance of eggs was assessed for the first time and compared with the traditional nine-point hedonic scale. The relative importance of egg attributes (egg type: regular, free-range, enriched with omega-3; egg size: small, medium, large; origin: local, regional, other Spanish origin; and price) was also evaluated. A structured face-to-face questionnaire was carried out in Barcelona. Consumers conducted a hedonic evaluation of three types of commercialized eggs (regular, free-range and enriched with n-3) using the AHP and the nine-point scale. Empirically, the producers of the enriched eggs should revise the feeding mixture for laying hens to minimize the negative impact that the enrichment had on sensory properties of eggs. Methodologically, the AHP approach seems to be a reliable tool to evaluate consumer hedonic preferences. However, other food products and larger sample size should be tested.
    Keywords: Analytical Hierarchy Process, consumers’ acceptance, eggs, omega-3., Agribusiness, Food Consumption/Nutrition/Food Safety, C00, C18, Q13,
    Date: 2015
  13. By: Georgiev, Nenad; Gjosevski, Dragon; Simonovska, Ana; Nacka, Marina
    Abstract: Building a recognizable brand for the Macedonian wine and higher values in intellectual property assets is the core for strengthening the wineries’ international market position. This paper attempts to identify Macedonian wineries’ opportunities to profit under competitive market conditions. Therefore, we first interpret evidence on determinants of their profitability, then we present their commitment towards intellectual property rights, and finally we describe a successful case of a winery that has a recognized brand internationally. The results indicated that wineries are not attractive investments if intensive marketing strategies in creation of strong brand equity are not strongly supported. The use of innovations, creativity and protection of intellectual property rights, could be successful strategy in increasing the opportunities to profit. The defined winery as distinctive case may be used as a guideline to reinforce wineries’ possibilities to follow future market signals, while struggling to adjust to the imposed market oriented production.
    Keywords: profitability strategy, marketing strategy, intellectual property rights, brand equity, competitive position., Marketing, Q13,
    Date: 2015
  14. By: Abhijit Banerjee; Sharon Barnhardt; Esther Duflo
    Abstract: A set of randomized experiments shed light on how markets and information influence household decisions to adopt nutritional innovations. Of 400 Indian villages, we randomly assigned half to an intervention where all shopkeepers were offered the option to sell a new salt, fortified with both iron and iodine (and not just iodine) at 50% discount. Within treatment villages, we conducted additional interventions: an increase in retailer margin (for one or several shopkeepers), the screening of an “edutainment” movie on the benefits of double-fortified salt, a flyer informing households of the product’s availability, and free distribution to a subset of households. We find that two interventions – showing the short film and offering an incentive to all shopkeepers – significantly increased usage: both by 5.5 percentage points, or over 50%, over take up without intervention, three years after launch. For comparison, only about half of households given the salt for free actually consumed it.
    JEL: I12 I15
    Date: 2015–10
  15. By: Cristina Félix Pereira (Aluna Doutoramento, Departamento de Gestão, Universidade de Évora); Ana Sampaio (Departamento de Matemática, Universidade de Évora); Fátima Jorge (Departamento de Gestão, Universidade de Évora)
    Abstract: Air navigation safety culture has been associated with organizational internal communication. The main objective of this study is to assess the hypothesized tri-dimensionality of Safety-Related Internal Communication (SRIC), in the context of High Reliability Organization’s (HRO) safety culture framework, as is the case of the Portuguese Air Navigation Service Provider (ANSP). So, and through an extensive literature review, Team Communication (TC), Management Communication (MC) and Safety Self-Attitude (SSA), have been identified as forming the first-order factor structure of the underlying second-order SRIC dimension. To examine whether the implementation of a second-order CFA model for the factorial validity of SRIC is feasible, 207 valid answers have been obtained through the submission, from June 2013 to December 2013, of a questionnaire to the operational staff from three different aeronautical careers in a previously selected European ANSP. In a first stage, maximum likelihood confirmatory factor analysis (CFA) results confirmed that, the proposed first-order structure reflected three distinctive aspects of SRIC dimension and, in a second stage, that the higher-order SRIC structure had an adequate fit to the data. Findings also confirmed that all constructs had good psychometric properties of convergent and discriminant validity. Results were also confirmed through a cross validation procedure.
    Keywords: Safety culture; Internal communication; Air navigation services; Confirmatory factor analysis
    JEL: R41
    Date: 2015

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