nep-mkt New Economics Papers
on Marketing
Issue of 2016‒02‒23
eight papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. Empirical Analysis of Consumer Purchase Behavior: Interaction between State Dependence and Sensitivity to Marketing-Mix Variables By Olga Novikova; Dmitriy B. Potapov
  2. The drivers of the substitution of individual services for bundled services: The case of Spain By Urueña López, Alberto; Gijón, Covadonga; Castro García-Muñoz, Raquel; Ureña Fernández, Olga; Feijóo, Claudio
  3. Embracing Diversity By Puntoni, S.
  4. Does Pharmaceutical Price Regulation Result in Greater Access to Essential Medicines? Study of the impact of drug price control order on sales volume of drugs in India By Sahay, Arvind; Jaikumar, Saravana
  5. Effect of Information on Consumer Perception: Evidence from Restaurant Hygiene Grade Cards in New York City By Kang, Danyang
  6. How fixed mobile usage interact? Does FTTH deployment influence the interaction? By Liang, Julienne
  7. Loss aversion on the phone By Christos Genakos; Costas Roumanias; Tommaso Valletti
  8. QoE-based service differentiation: Business models analysis for the mobile market By Martinez, Luis; Nesse, Per Jonny; Markendahl, Jan

  1. By: Olga Novikova (National Research University Higher School of Economics); Dmitriy B. Potapov (National Research University Higher School of Economics)
    Abstract: People are intent to make similar choices especially in consumer goods markets. To address both explanations of this persistence, i.e. state dependence and heterogeneity in preferences, we use random coefficient logit model based on scanner panel data on juice purchases. The product differentiation of the chosen category allows us to model three dimensions of state dependence on brand, size and flavor characteristics. We provide evidence that the persistence in brand choices is positively correlated with persistence in size and flavor choices, thus the consumer pattern is prone to be inertial or variety seeking in every product characteristics. Simultaneously we show that the more sensitive to price and promotional activities consumers are, the less inertial is their behavior
    Keywords: State dependence, random coefficient logit, product differentiation
    JEL: M31 D12
    Date: 2015
  2. By: Urueña López, Alberto; Gijón, Covadonga; Castro García-Muñoz, Raquel; Ureña Fernández, Olga; Feijóo, Claudio
    Abstract: In 2007, Spanish telecoms companies began to offer bundled services. Operators started by offering phone plus broadband and phone plus broadband plus pay television bundles, and in doing so, were able to reduce aggregated prices for consumers. In addition to monetary incentives, this study examines the causes that lead consumers (individuals) and households (as economic agents) to replace individual contracts with bundled contracts including more (or fewer) services from those previously subscribed to individually. A model of demand of access to household and individual services was estimated for three services: landline phone, Internet, and pay television using a representative panel of telecoms consumers in Spain. The results show –in decreasing order- the influence of previous experience with particular services, followed by factors related to usage and factors linked with socio-demographic characteristics. Monetary incentives -contrary to common belief- play a significant but minor role.
    Keywords: telecoms bundles,substitution,landline phone,broadband Internet,pay tv,triple play,random effects model
    Date: 2015
  3. By: Puntoni, S.
    Abstract: __Abstract__ Societies are vastly more diverse today than they used to be and, in many industries, developing theories and approaches that recognize and capitalize on this greater consumer diversity is crucial. In business schools, diversity tends to be discussed only in relation to human resource management. However, understanding the consequences of diversity is important also for marketing researchers. More generally, if pluralistic societies like ours wish to remain harmonious and prosperous, all groups within them have to feel included as stakeholders. Marketplace inclusiveness is an important condition for this to happen. In this inaugural address, I argue that a diversity perspective is helpful in making sense of social phenomena. I will first describe the tensions associated with globalization in terms of diversity. I then review various approaches to conducting research on diversity, giving examples from my own work and highlighting areas for future research. I conclude with some observations about the implications of increasing globalization and diversity for brand strategy and for management practice more generally.
    Keywords: Marketing, Diversity, Marketplace inclusiveness, Globalization, Branding, Consumer behavior, Business and society
    JEL: M30 F
    Date: 2015–03–13
  4. By: Sahay, Arvind; Jaikumar, Saravana
    Abstract: In this paper, we empirically examine whether price regulation of generic essential drugs in India results in social welfare (in terms of increase in sales volume post regulation). In 2013, the Indian government enacted the Drug Price Control (DPCO) which regulated the prices of essential medicines. Using historical monthly sales volume data, we identify the best fitting SARIMA (seasonal auto regressive integrated moving average) model for each of the 105 oral solid molecules included in DPCO 2013. Using these models and following the event study approach we statistically compare the baseline against the actual volume during event window. We find that while DPCO resulted in an increase in sales volume for few molecules, overall the regulation has resulted in a reduction in sales volume. On further analysis, we find that increasing the detailing efforts for molecules with high percentage sales in urban and semi-urban cities may likely result in positive DPCO impact. Our findings have significant policy and marketing implications.
  5. By: Kang, Danyang
    Abstract: This study examines the effects of increasing provision of hygiene quality information on consumer assessment of restaurant quality. In July 2010 New York City introduced mandatory hygiene grade cards to be displayed in restaurants. I show that both an A grade and better inspection scores are correlated with higher ratings in food, decor, service and price, with the former having a larger impact. These results suggest that consumers give much credence to the information provided by hygiene grade cards but the underlying scores might not reflect the true hygiene quality of restaurants.
    Keywords: consumer assessment, restaurant quality, hygiene quality information, hygiene grade card, Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, Health Economics and Policy, Industrial Organization,
    Date: 2015–09
  6. By: Liang, Julienne
    Abstract: We estimate the interaction between …fixed and mobile usage both for voice and data services using consumer level data from April 2013 to March 2014 in a European country. We …find a signi…cant proportion of …fixed voice consumption could be substituted by mobile voice, and vice versa. However, a substantial proportion of fixed data consumption, and also mobile data consumption, is generated by fixed-mobile interaction in both directions. FTTH deployment has no signi…cant impact on …fixed-mobile voice substitution. The … fixed data consumption generated by mobile to …fixed interaction appears to increase with FTTH deployment.
    Keywords: Fixed mobile,…fixed mobile usage interaction,voice consumption,data consumption,substitution versus complementarity,FTTH deployment
    JEL: L43 L50 L96
    Date: 2015
  7. By: Christos Genakos; Costas Roumanias; Tommaso Valletti
    Abstract: We analyze consumer switching between mobile tariff plans using consumer-level panel data. Consumers receive reminders from a specialist price-comparison website about the precise amount they could save by switching to alternative plans. We find that the effect on switching of being informed about potential savings is positive and significant. Controlling for savings, we also find that the effect of incurring overage payments is also significant and six times larger in magnitude. Paying an amount that exceeds the recurrent monthly fee weighs more on the switching decision than being informed that one can save that same amount by switching to a less inclusive plan, implying that avoidance of losses motivates switching more than the realization of equal-sized gains. We interpret this as evidence of loss aversion. We are also able to weigh how considerations of risk versus loss aversion affect mobile tariff plan choices: we find that a uniform attitude towards risk in both losses and gains has no significant influence on predicting consumers’ switching, whereas perceiving potential savings as avoidance of losses, rather than as gains, has a strong and positive effect.
    Keywords: loss aversion; consumer switching; tariff plans; risk aversion; mobile telephony
    JEL: D10 D12 D81 L96
    Date: 2015–09
  8. By: Martinez, Luis; Nesse, Per Jonny; Markendahl, Jan
    Date: 2015

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