nep-mkt New Economics Papers
on Marketing
Issue of 2017‒07‒30
thirteen papers chosen by
João Carlos Correia Leitão
Universidade da Beira Interior

  1. Consumer Perception and Comparative Analysis of sport shoes brand By Mit Shah
  2. To study the consumers buying behavior towards clothing Retail Brands in Ahmedabad city. By PADMAKSHI SHARMA
  3. Effect of Convergent Product Perception on Experiential Brand Loyalty: An Interactive Device Viewpoint By Anirban Chakraborty; Amit Tiwari
  4. Discrimination through "Versioning" with Advertising in Random Networks By Antonio Jiménez-Martínez; Óscar González-Guerra
  5. Samsung?s Galaxy Note 7: How a Product Can Go Up in Smoke By Peter Stanwick
  8. How Australians Pay: Evidence from the 2016 Consumer Payments Survey By Mary-Alice Doyle; Chay Fisher; Ed Tellez; Anirudh Yadav
  9. Manufacturer collusion: Strategic implications of the channel structure By Reisinger, Markus; Thomes, Tim Paul
  11. Wells Fargo: A Runaway Unethical Cover Wagon By Sarah Stanwick
  12. Identifying the Effect of Mobile Operating Systems on the Mobile Services Market By Toshifumi Kuroda; Teppei Koguchi; Takanori Ida
  13. Impact of Psychological Needs on Luxury Consumption By Ning Mao; Michael McAleer; Shuyu Bai

  1. By: Mit Shah (Pandit Deendayal Petroleum University)
    Abstract: Indian economy has substantially changed in last 3 decades. The economic upliftment has given considerable purchasing power to Indian consumers. Now, Indian consumers are more inclined towards branded products. Specifically, youth is considerably influenced by the branding of the multinational companies in different product categories. This paper focuses on the comparison between marketing strategies of sports shoe brand i.e. Nike and Adidas in particular. Segmentation, Positioning and marketing mixes will be stated. Consumers perception while giving preferences to a particular brand will be told. Innovative market practices implemented by global brands as well as its influence on consumers will be stated. Consumers viewpoints will also be told. Lastly, conclusion and point of view from my side on comparative marketing strategy will be stated.
    Keywords: Consumers perception, Marketing strategy, Branding. Purchasing Power
    JEL: D40
    Date: 2017–07
    Abstract: Clothing sector is one of the oldest industries in India. India is witnessing change in lifestyle of large section of population. Clothing also forms to be a basic need of living. To understand the consumer behavior concerning to leading clothing brands. Consumers give importance to brands and relate their prestige with different brands. They see brands in different perspectives and expect better quality of brands. For the consumers to identify their needs to understand how they behave what influences them to buy particular clothing brand what process they follow while selecting a product or service. Consumer attributes (like brand consciousness, social class & other factors personal characteristics) were explored in relation to the purchase behavior of the youth. Also this paper helps to understand that what the reasons consumers make for purchasing the product. Also study how factors influence consumer purchases. The purpose of the research is to investigate the youth in the city of Ahmedabad to understand if any factors affect their buying behavior for clothes.
    Keywords: Consumer Perception, Consumer Buying behavior, Clothing retail brand
    Date: 2017–07
  3. By: Anirban Chakraborty (Indian Institute of Management Lucknow); Amit Tiwari (Indian Institute of Management Lucknow)
    Abstract: The profusion of convergent products is a reigning paradigm & key characteristic of contemporary products. The boundaries between products are disappearing rapidly due to convergence. In this study, we propose a conceptual model and theorise about the impact of convergent product dimensions on brand loyalty mediated through user experience. In the effort to understand convergent product perception more carefully, this study proposes six attributes of convergent product: Usefulness, Ease of use, Aesthetics, Innovativeness of technology, Self-expression, Entertainment. It is the user experience, arising as a consequence of convergent product usage that can lead to brand loyalty. The proposed model thus sees user experience as an mediating factor when it comes to the relationship between convergent product perception and brand loyalty. It is pertinent that each element of the convergent product should enhance the experience of the consumer while using the product on a day to day basis. This study integrates three branches of literature viz. convergent product literature, brand loyalty, and user experience literature; This makes the work a novel attempt to integrate concepts of convergent product dimensions, user experience, and brand loyalty. Regarding contribution, this study should provide an indication to the designers and marketers, what Convergent product dimensions are considered most important by the user as well as their contribution to the market success of a convergent product. The model can also be used as a tool to ensured success of a particular convergent product which provides different levels of the dimension of convergent product.
    Keywords: Convergent product, Brand loyalty, User Experience, Entertainment
    JEL: M31
    Date: 2017–07
  4. By: Antonio Jiménez-Martínez (Division of Economics, CIDE); Óscar González-Guerra (Division of Economics, CIDE)
    Abstract: This paper proposes a framework of second-degree discrimination with two different versions of a service that are served in random networks with positive externalities. In the model, consumers must choose between purchasing a premium version of the service or a free version that comes with advertising about a certain good (unrelated to the service). The ads attached to the free version influence the free version adopters’ opinions and, given the induced effects on the good sales, they affect the optimal pricing of the premium version. We relate the optimal pricing strategy to the underlying hazard rate and degree distribution of the random network. Under increasing hazard rates, hazard rate dominance always implies higher prices for the service. In some applications of the model, decreasing hazard rates are often associated to extreme situations where only the free version of the service is provided. The model provides foundations for empirical analysis since key features of social networks can be related to their underlying hazard rate functions and degree distributions.
    Keywords: Social networks, second-degree discrimination, advertising, degree distributions, hazard rate
    JEL: D83 D85 L1 M3
    Date: 2016–09
  5. By: Peter Stanwick (Auburn University)
    Abstract: On August 2, 2016, Samsung announced its new smartphone, the Galaxy Note 7. A month later, Samsung recalled 2.5 million Galaxy Note 7s due to the phones catching on fire. By October 2016, Samsung permanently discontinued the Galaxy Note 7 smartphone. The purpose of this case is to examine how Samsung addressed the needs of its stakeholders in the introduction and subsequent recall of the Galaxy Note 7. From a stockholder perspective, Samsung was under pressure to produce a phone to rival the iPhone and have it to market before Apple could launch a new product. They succeeded with this goal since the iPhone 7 was not introduced until September 7, 2016. From a customer perspective, Samsung did not believe that there was a problem with the phone until customer protests forced Samsung to react. In addition, airlines, based on the recommendation by the Federal Aviation Administration, banned customers from carrying a Galaxy Note 7 onboard airplanes. From an employee?s perspective, there were fundamental flaws in the design of the smart phone, yet the quality issues were not resolved until after the recall occurred. For Chinese customers, Samsung delayed the recall by claiming that the defective batteries were not included in the Chinese market. In addition, once the phones were recalled, the replacement batteries also generated overheating and a shortened battery life. From a supplier perspective, Samsung concluded that the lithium-ion battery in the phone would overheat and create the fire. One of the suppliers of the batteries was Samsung SDI. From a global governmental regulatory perspective, Samsung was slow to react to the government regulations regarding the recall of a potentially dangerous product. Furthermore, the United States Consumer Product Safety Commission recommended that consumers immediately stop using the Galaxy Note 7 once the information pertaining to the fires became public. As a result, this case study will highlights the strengths and weaknesses of Samsung?s attempt to address the needs of its stakeholder during this product crisis.
    Keywords: Samsung; Recall; Stakeholders
    Date: 2017–07
  6. By: Boopendra seetanah (Uni of Mauritius)
    Abstract: The objective of the present study is two-fold. Firstly, to assess the impact of air access liberalization on tourism demand for Mauritius and secondly to analyse the dual impact of the interplay between air access liberalization and marketing promotion efforts on tourism demand. Using an Autoregressive Distributed Lag model, the results suggest that air access liberalisation is an important ingredient, albeit to a lesser extent as compared to other classical explanatory variables, of tourism demand. The results also highlight the fact that Mauritius is perceived as a luxurious destination and tourists are also deemed to be price sensitive. Moreover our dynamic approach interestingly confirms the presence of repeat tourism in the island. Finally, the findings also uncover the positive impact of the interplay between air access liberalization and marketing promotion efforts on fostering tourism demand.
    Keywords: Air Transport Liberalisation, Tourism, Autoregressive Distributed Lag Model.
    JEL: C22 F19
    Date: 2017–07
    Abstract: Sponsorship; has a significant power in terms of acquisition of effective communication with the audience's sympathy and trust between institutions with the target audience. Therefore, sponsorship activities are the most important aspect of public relations.Founded in 1933 in Turkey and nowadays being a Star Alliance member, with the national quality award in aerospace industry, which is a global brand that has many international awards, Turkish Airlines flies to 275 more destinations in the world and attributes great importance to the sponsorship.In this research, Turkish Airlines' ?Batman V Superman Dawn of Justice? movie sponsorship and the aimed goals through this sponsorship are discussed. In the first part of the study, Turkish Airlines? foundation history and branding period have been discussed. Additionally other sponsorship activities of the company have been revisited. The main part of "Batman V Superman Dawn of Justice" movie sponsorship has been investigated further as the spotlight. At this point; it has been focused on movie?s adaptation to brand sponsorship, sponsorship objectives and results.In order to collect the primary data, in-dept interview will be held. Also secondary data will be collected from the marketing literature and related trade magazines, websites. The results of this sponsorship case are significant in guiding other Turkish brands during branding process.
    Keywords: Marketing communication, sponsorship, Turkish Airlines
    Date: 2017–05
  8. By: Mary-Alice Doyle (Reserve Bank of Australia); Chay Fisher (Reserve Bank of Australia); Ed Tellez (Reserve Bank of Australia); Anirudh Yadav (Reserve Bank of Australia)
    Abstract: The Reserve Bank's triennial Consumer Payments Survey (CPS) provides a detailed snapshot of how Australian consumers make payments. The 2016 CPS recorded information on around 17 000 day-to-day payments made by over 1 500 participants during a week. The data show that Australian consumers continued to switch from paper-based ways of making payments such as cash and cheques, towards digital payment methods (particularly debit and credit cards). Cards were the most frequently used means of payment in the 2016 survey, overtaking cash for the first time. Contactless 'tap and go' cards are an increasingly popular way of making payments, displacing cash for many lower-value transactions. Despite these trends, cash still accounts for a material share of consumer payments and is intensively used by some segments of the population. Payments using a mobile phone at a card terminal are a relatively new feature of the payments system and this technology was not widely used at the time of the survey. However, consumers are increasingly using their mobile phones to make online and person-to-person payments. Similarly, consumers are using automatic payments, such as direct debits, more frequently.
    Keywords: consumer payment choice; consumer survey; method of payment; payment systems
    JEL: D12 D14 E42
    Date: 2017–07
  9. By: Reisinger, Markus; Thomes, Tim Paul
    Abstract: We investigate how the structure of the distribution channel affects tacit collusion between manufacturers. When selling through a common retailer, we find - in contrast to the conventional understanding of tacit collusion that firms act to maximize industry profits - that colluding manufacturers strategically induce double marginalization so that retail prices are above the monopoly level. This lowers industry profits but increases the profit share that manufacturers appropriate from the retailer. Comparing common distribution with independent (exclusive) distribution, we show that the latter facilitates collusion. Despite this result, common retailing leads to lower welfare because a common retailer monopolizes the downstream market. For the case of independent retailing, we also demonstrate that contract offers that are observable to the rival retailer are not necessarily beneficial for collusive purposes.
    Keywords: tacit collusion,contract observability,common retailing,independent (exclusive) retailing,two-part tariffs,wholesale price contracts
    Date: 2017
  10. By: Mirza Ashfaq Ahmed (University of Gujrat)
    Abstract: In political realm, the political-specific brand equity is gaining growing attention. This effort is to develop a political-specific measurement model to get insight regarding the voter?s behavior, voter choices, voting intentions and to generate more valid and reliable results. The literature from the relevant domains including Marketing, Politics, and Behavioral sciences has been reviewed to develop a good understanding and insight into relevant published material and the trends that have emerged there from to review the types of measures. Based on the reviewed measures and their literally proven chronological cause-effect relationships, a conceptual model of voter based brand equity has been proposed. Following questions are hypothesized: (1) what is the contribution of political socialization process in the development of social identity and emotional response? (2) Do the social identity and emotional response positively influence the party trust and party commitment? (3) Do the party trust and party commitment positively influence the voting intentions of the voters? (4) Does the party loyalty have moderating role among the structural relationships of the model constructs? The results indicate that to improve the voting intentions political parties have to engage themselves in the political socialization process.
    Keywords: Political Marketing, Socialization Process, Voting Intentions, Party Politics
    JEL: M00 M00
    Date: 2017–07
  11. By: Sarah Stanwick (Auburn University)
    Abstract: The purpose of this case analysis is to examine how a model of aggressive selling goals established by Wells Fargo in order to increase its level of profitability resulted in a wide scale level of unethical behavior by Wells Fargo employees. In the 1980s, Wells Fargo introduced the concept of ?cross-selling? to its sales representatives. Cross selling is the process in which the sales reps for Wells Fargo would encourage its customers to open additional Wells Fargo accounts. Initially, the target number of products for the sales reps to sell each Wells Fargo customer was eight. At the end of 2015, the average Wells Fargo customer had 6.3 products.As a result, achievement of aggressive sales goals became entrenched in the evaluation process of the employees and became part of the foundation of Wells Fargo?s corporate culture. These aggressive selling tactics became public when it was disclosed that Wells Fargo sales representatives had opened approximately two million deposit and credit-card accounts without the customer?s knowledge. In September 2016, Wells Fargo was fined $185 million by federal regulators for ?widespread illegal? sales practices. Wells Fargo had stated that 5,300 employees had been fired in the previous five years due to improper selling of Wells Fargo products. After the selling practices became public, Wells Fargo announced that it would eliminate all product sales goals for its retail banking operations starting in January 2017. In November 2016, Wells Fargo was again in the spotlight because the Financial Industry Regulatory Authority was investigating whether Wells Fargo employees were being fired because they spoke out against the aggressive selling tactics they were forced to use on Well Fargo customers. In January 2017, it was disclosed that Wells Fargo?s bank branches were informed beforehand when Wells Fargo?s internal auditors were coming to the branch to inspect internal operations. By giving the branches a 24-hour notice, the employees at the branch had time to cover up improver practices, such as opening up fake accounts and signing up customers for additional products without their knowledge.As a result, this case study will examine the evolution of unethical behavior at Wells Fargo based on requiring the employees to aggressively sell accounts and products to its customers.
    Keywords: Wells Fargo; Cross Selling; Customer Rights
    Date: 2017–07
  12. By: Toshifumi Kuroda; Teppei Koguchi; Takanori Ida
    Abstract: Modern economic theory predicts that tying can serve as a tool for leveraging market power. In line with this economic theory, competition authorities regulate the tying of Microsoft Windows with its Media Player or Internet browser in the EU and Japan. The authorities also take note of the market power of mobile handset operating systems (OSs) over competition in the app and services markets. However, no empirical evidence has thus far been presented on the success of government intervention in the Microsoft case. To assess the effectiveness of government intervention on mobile handset OSs, we identify the extent to which complementarity and consumer preferences affect the correlation between mobile handset OSs and mobile service app markets (mail, search, and map). We find significant positive complementarity between the mail, search, and map services, and mobile handset OSs. However, the elasticities of the mobile handset OS–mobile service correlations are rather small. We conclude that taking action to restrict mobile handset OSs is less effective than acting on mobile services market directly.
    Keywords: Mobile phone, Handset, Internet service, Platform competition
    JEL: L12 L43 L96
    Date: 2017–07
  13. By: Ning Mao (China-ASEAN International College and Dhurakij Pundit University, Thailand); Michael McAleer (National Tsing Hua University, Taiwan; University of Sydney Business School; Erasmus University Rotterdam, The Netherlands, Complutense University of Madrid, Spain and Yokohama National University, Japan); Shuyu Bai (Limian Material Technology Corporation, China)
    Abstract: This paper examines the impact of psychological needs on luxury consumption. Veblen’s Theory of the Leisure Class (1899) invented the term “conspicuous consumption” to describe luxury goods and services, in which Veblen indicated the purpose of luxury consumption was to display wealth and social status. This paper integrates the following two papers: (1) Han and Zhou (2002), who proposed an integrative model, and argued that three variables, namely Country-of-Origin, Brand Name, and Price, were major predictors for overall product evaluation and purchase intentions; and (2) Han, Nunes and Dreze (2010), who proposed a taxonomy called The Luxury 4Ps, to explain the inductive and deductive psychological needs of luxury consumption.
    Keywords: Psychological needs; Luxury consumption; Consumer behavior
    JEL: N35 Z12 Z13
    Date: 2017–07–18

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