nep-mkt New Economics Papers
on Marketing
Issue of 2016‒03‒17
five papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. Monopoly price discrimination and privacy: the hidden cost of hiding By BELLEFLAMME, P.
  2. Fairs for e-commerce: the benefits of aggregating buyers and sellers By Pierluigi Gallo; Francesco Randazzo; Ignazio Gallo
  3. False Advertising By Rhodes, Andrew; Wilson, Chris
  5. Determinants of Customer Relationship Development By Dagmar Lesakova

  1. By: BELLEFLAMME, P. (Université catholique de Louvain, CORE, Belgium)
    Abstract: A monopolist can use a ‘tracking’ technology that allows it to identify a consumer's willingness to pay with some probability. Consumers can counteract tracking by acquiring a ‘hiding’ technology. We show in this note that consumers are collectively better off when this hiding technology is not available, even when consumers can acquire it free of charge.
    Keywords: price discrimination, privacy, monopoly
    JEL: D11 D18 L12 L86
    Date: 2015–10–15
  2. By: Pierluigi Gallo; Francesco Randazzo; Ignazio Gallo
    Abstract: In recent years, many new and interesting models of successful online business have been developed. Many of these are based on the competition between users, such as online auctions, where the product price is not fixed and tends to rise. Other models, including group-buying, are based on cooperation between users, characterized by a dynamic price of the product that tends to go down. There is not yet a business model in which both sellers and buyers are grouped in order to negotiate on a specific product or service. The present study investigates a new extension of the group-buying model, called fair, which allows aggregation of demand and supply for price optimization, in a cooperative manner. Additionally, our system also aggregates products and destinations for shipping optimization. We introduced the following new relevant input parameters in order to implement a double-side aggregation: (a) price-quantity curves provided by the seller; (b) waiting time, that is, the longer buyers wait, the greater discount they get; (c) payment time, which determines if the buyer pays before, during or after receiving the product; (d) the distance between the place where products are available and the place of shipment, provided in advance by the buyer or dynamically suggested by the system. To analyze the proposed model we implemented a system prototype and a simulator that allow to study effects of changing some input parameters. We analyzed the dynamic price model in fairs having one single seller and a combination of selected sellers. The results are very encouraging and motivate further investigation on this topic.
    Date: 2016–02
  3. By: Rhodes, Andrew; Wilson, Chris
    Abstract: There is widespread evidence that some firms use false advertising to overstate the value of their products. Using a model in which a policymaker is able to punish such false claims, we characterize a natural equilibrium in which false advertising actively influences rational buyers. We analyze the effects of policy under different welfare objectives and establish a set of demand and parameter conditions where policy optimally permits a positive level of false advertising. Further analysis considers some wider issues including the implications for product investment and industry self-regulation.
    Keywords: Misleading Advertising,Pass-through,Product Quality
    JEL: M37 L15 D83
    Date: 2016–02–22
  4. By: Figen Ersoy (Anadolu University); Nuri Calik (Turgut Ozal University, Turkey)
    Abstract: This study intends to find out the consumer innovativeness and information seeking behavior which are assumed to be negatively correlated with consumer risk perceptions. A survey on 880 respondents who are selected via stratified sampling of which 863 are found eligible to be analyzed. The respondents are required to answer 50 questions of which five are related to demographic characteristics of these respondents. The rest 45 are statements which are designed to reflect the innovativeness and risk perception of the consumers which are two controversial issues... The study consists of five parts. The first part is an introduction where the scope and the purpose of the study are concisely stated. The second part relates to the theoretical background of the subject matter and the prior researches carried out so far. The third part deals with research methodology, basic premises and hypotheses attached to these premises. Research model and analyses take place in this section. Theoretical framework is built and a variable name is assigned to each of the question asked or proposition forwarded to the respondents of this survey. 45 statements or propositions given to the respondents are placed on a five-point Likert scale. The remaining five questions about demographic traits as age, gender, occupation, educational level and monthly income are placed either on a nominal or ratio scale with respect to the nature of the trait. Five research hypotheses are formulated in this section. The fourth part mainly deals with the results of the hypothesis tests and a factor analysis is applied to the data on hand. Here exploratory factor analysis reduces 45 variables to eight basic components as "Online shopping risks, technology readiness, risk avoidance, physical risk perception, consumer innovativeness, functional risk perception, information seeking behavior, and social risk perception. Cronbach's Alpha for scale reliability is (ï ¡ = 0.731) and the sample adequacy ratio (KMO ) is 0.835. In addition non-parametric bivariate analysis in terms of Chi-Square is applied to test the hypotheses formulated in this respect. The fifth part is the conclusion where findings of this survey are listed.
    Keywords: Consumer innovativeness, information seeking behavior, risk perception and risk avoidance, technology-proneness, functional and physical risks.
    JEL: M31
  5. By: Dagmar Lesakova (University of Economics in Bratislava)
    Abstract: Customer relationship development is the focus of any business. It is increasingly found to be at the top of organisations´ agendas, aiming at creating and enhancing relationships with customers in order to improve both business profitability and satisfaction of customers. Measuring customer focus can be helpful in understanding this effort by providing a valuable framework for customer relations assessment. In this context our research offers an integrated approach for understanding the customer relationships. The aim of our article is threefold: we aim to indicate and explore the determinants for improving customer relationship development in tourist sector, to propose measures for assessing customer focus in tourist organisations in Slovakia and to explain relationship between customer relationship level and business performance. This will be achieved by determining the subcategories of the customer management processes and by identifying determinants affecting business performance. In order to translate customer focus into specific activities designed to increase business performance, the determinants were made operational applying quantitative analysis. Results of the research reveal that tourist companies in Slovakia adopt customer oriented approach and try to optimize their relationships with customers. However, there is a space towards continual improvement. In our article, factors with insufficient performance have been discussed and solutions proposed to improve the results. Finally, a framework for determining the strength of the relationship between business performance and customer focus variables is introduced.
    Keywords: Customer focus, customer relations, business performance, external environment, internal environment.
    JEL: M20

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