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Author: Hagit Perry Publisher: ISBN: Category : Languages : en Pages : 89
Book Description
Marketing literature and practitioners are in agreement that it is essential for brands in competitive markets to identify segments that should be targeted and to build rational product strategies that target these segments. It is essential because most markets include consumers with heterogeneous preferences and precise segmentation and targeting creates product differentiation, which prevents direct competition and allow the market to reach an optimal profit optimization equilibrium. In this consumer markets' era, defined by practitioners as the big data era, consumers' individual transactions and actions, which reveal their preferences, became highly available to marketers. This allows marketers to greatly improve their targeting and to optimize their profits through that. This dissertation contains three essays that examine optimal products strategies with consideration of individual distributions. Through the models that are built and estimated, individual preferences are identified. Following that, individuals are aggregated into clustered segments, and clear optimization strategy is designed. All the essays build and discuss structural models and estimation strategies. Each estimation uses unique datasets that were selected and organized carefully for the purpose of robust identification of the varied effects that are examined and analyzed. Each essay identifies and considers the individual distributions in the analyses. Altogether, the essays provide a deeper understanding of how to consider individual distributions in varied settings and marketing needs that marketers face frequently. Chapter 1 examines the theory of trying, forgetting, and sales in empirical settings. This is an important model as there are many markets where consumers need to try products for realizing their fit, however after trying, some consumers may forget the fit over time through learning processes of competitive information and other processes. The theory shows that the trying and forgetting model predicts that sales will occur periodically according to the magnitudes of the effects as the sales are used by the brands as product-fit reminders to the targeted consumers. For the empirical examination of this theory, a model that includes trying and forgetting effects within the standard demand side model is built and estimated. The model allows consumers to have heterogeneous tastes and includes treatment for possible endogeneity. Using the demand estimation and including an individual level distribution estimation, the population is divided into segments. Consumers are divided by their utilities for products as it is optimal for firms to target with the regular price the segments that favor the and when they launch sales, they may target more segments as the trying experience may affect their utility and make them be included in the main segment that this firm targets. This segmentation of the data makes it possible to find the equilibrium in which each firm optimizes profits and the market does not enter a situation of direct competition and a Bertrand game as the firms focus on the segments that favor them and launch temporal sales to introduce or remind consumers of the products fit. This allows the identification prices strategies that optimize profits. Chapter 1 also builds a novel dynamic game supply side model together with simulation strategy and technique for that. This is a major contribution as it finds the equilibrium of a multi agent, segments, states, and periods dynamic game for these common settings where firms need to design a long-term, per period, pricing menu as they cannot change their product pricing often. The results of the estimation and simulation show that the trying and forgetting effects are highly significant on the demand side, but are not used well by some brands through their introduction period and afterward, which greatly and negatively influence their market share and long-term profits. Chapter 2 examines a method of finding individual level preference for attributes across products and the importance that it can have on policy makers, marketers, and consumers. It specifically discusses the case of reducing overweight in the population through finding the willingness to pay for the fat attribute of products among consumers that consistently buy fattier products at varied categories and introducing these consumers to products that are healthier for them through promotions on those products. This is an important question as overweight is was recognized as a global epidemic and thus researchers and policy makers are consistently looking for solutions with no consistent finding yet as neither macro taxes of attributes such as sugar or fat nor or macro subsidies of healthier products were feasible, effective, or efficient. It shows that the standard model does not allow targeted and effective promotions to these consumers as there is a gap in willingness to pay for fat through the population compared to the targeted group. However, using the estimation of the individual level distributions, this part shows that it is possible to convert this segment of consumers to choose healthier products through small magnitude promotional pricing. Chapter 3 examines a case that is opposite to the previous chapters. While in the previous chapters the segments were revealed through the estimation and individual distribution estimation methods. The data in this chapter saliently reveals that 20\% of consumers increased their per unit spend in a durable goods category at the first months of the US sub-prime recession of 2008. This hints that a large portion of the consumers became price loving at the beginning of one of the most difficult periods of the US economy. This is clearly the opposite to the expectation, thus chapter examines the data carefully and suggest varied models. Finally, it shows that in this case, a well specified demand model can identify the reasons for the initial confusion coming from the data. Altogether, the essays examine frequent market settings that were not examined before and provide models together with estimation strategies and methods, which allow better optimization of product strategies through the consideration of individual level distributions and through segmenting the population accordingly.
Author: Hagit Perry Publisher: ISBN: Category : Languages : en Pages : 89
Book Description
Marketing literature and practitioners are in agreement that it is essential for brands in competitive markets to identify segments that should be targeted and to build rational product strategies that target these segments. It is essential because most markets include consumers with heterogeneous preferences and precise segmentation and targeting creates product differentiation, which prevents direct competition and allow the market to reach an optimal profit optimization equilibrium. In this consumer markets' era, defined by practitioners as the big data era, consumers' individual transactions and actions, which reveal their preferences, became highly available to marketers. This allows marketers to greatly improve their targeting and to optimize their profits through that. This dissertation contains three essays that examine optimal products strategies with consideration of individual distributions. Through the models that are built and estimated, individual preferences are identified. Following that, individuals are aggregated into clustered segments, and clear optimization strategy is designed. All the essays build and discuss structural models and estimation strategies. Each estimation uses unique datasets that were selected and organized carefully for the purpose of robust identification of the varied effects that are examined and analyzed. Each essay identifies and considers the individual distributions in the analyses. Altogether, the essays provide a deeper understanding of how to consider individual distributions in varied settings and marketing needs that marketers face frequently. Chapter 1 examines the theory of trying, forgetting, and sales in empirical settings. This is an important model as there are many markets where consumers need to try products for realizing their fit, however after trying, some consumers may forget the fit over time through learning processes of competitive information and other processes. The theory shows that the trying and forgetting model predicts that sales will occur periodically according to the magnitudes of the effects as the sales are used by the brands as product-fit reminders to the targeted consumers. For the empirical examination of this theory, a model that includes trying and forgetting effects within the standard demand side model is built and estimated. The model allows consumers to have heterogeneous tastes and includes treatment for possible endogeneity. Using the demand estimation and including an individual level distribution estimation, the population is divided into segments. Consumers are divided by their utilities for products as it is optimal for firms to target with the regular price the segments that favor the and when they launch sales, they may target more segments as the trying experience may affect their utility and make them be included in the main segment that this firm targets. This segmentation of the data makes it possible to find the equilibrium in which each firm optimizes profits and the market does not enter a situation of direct competition and a Bertrand game as the firms focus on the segments that favor them and launch temporal sales to introduce or remind consumers of the products fit. This allows the identification prices strategies that optimize profits. Chapter 1 also builds a novel dynamic game supply side model together with simulation strategy and technique for that. This is a major contribution as it finds the equilibrium of a multi agent, segments, states, and periods dynamic game for these common settings where firms need to design a long-term, per period, pricing menu as they cannot change their product pricing often. The results of the estimation and simulation show that the trying and forgetting effects are highly significant on the demand side, but are not used well by some brands through their introduction period and afterward, which greatly and negatively influence their market share and long-term profits. Chapter 2 examines a method of finding individual level preference for attributes across products and the importance that it can have on policy makers, marketers, and consumers. It specifically discusses the case of reducing overweight in the population through finding the willingness to pay for the fat attribute of products among consumers that consistently buy fattier products at varied categories and introducing these consumers to products that are healthier for them through promotions on those products. This is an important question as overweight is was recognized as a global epidemic and thus researchers and policy makers are consistently looking for solutions with no consistent finding yet as neither macro taxes of attributes such as sugar or fat nor or macro subsidies of healthier products were feasible, effective, or efficient. It shows that the standard model does not allow targeted and effective promotions to these consumers as there is a gap in willingness to pay for fat through the population compared to the targeted group. However, using the estimation of the individual level distributions, this part shows that it is possible to convert this segment of consumers to choose healthier products through small magnitude promotional pricing. Chapter 3 examines a case that is opposite to the previous chapters. While in the previous chapters the segments were revealed through the estimation and individual distribution estimation methods. The data in this chapter saliently reveals that 20\% of consumers increased their per unit spend in a durable goods category at the first months of the US sub-prime recession of 2008. This hints that a large portion of the consumers became price loving at the beginning of one of the most difficult periods of the US economy. This is clearly the opposite to the expectation, thus chapter examines the data carefully and suggest varied models. Finally, it shows that in this case, a well specified demand model can identify the reasons for the initial confusion coming from the data. Altogether, the essays examine frequent market settings that were not examined before and provide models together with estimation strategies and methods, which allow better optimization of product strategies through the consideration of individual level distributions and through segmenting the population accordingly.
Author: James Winslow Sawhill Publisher: ISBN: Category : Languages : en Pages : 128
Book Description
This dissertation is composed of three essays focused on strategic considerations for product development. In chapter I, I address the question of whether consumers equally weigh capital and operating costs when purchasing durable goods. This trade off is important to manufacturers as they determine how much of their product design and production costs should be dedicated to keeping operating costs low. I test this empirically using data from the automobile industry. Chapter II is also an empirical study which explores whether consumers are willing to pay for socially responsible products. The answer to this question is important for firms to address in their product development process as they decide whether they will gain more market share by producing a socially responsible product with somewhat higher costs or a low cost product which does not incorporate socially responsible practices. In this case, I use data on retail sales in coffee industry using fair trade practices as an exemplar of social responsibility. Chapter III addresses the question of how durable or reliable manufacturers of durable goods should make their products. Consumers will likely want to pay more for a more durable product, yet increased durability depresses replacement demand. I attempt to gain insight into this trade off by developing an analytical model of the interplay between consumers and a monopolist manufacturer of durable goods. The remainder of the abstract provides a more detailed summary of each of these chapters in turn. Chapter I explores whether consumers behave as if they are optimally trading off capital and operating costs when purchasing a durable good. I study this question using data on gas prices and automobile sales over the 20 year period, 1971-1990. This question is important for three reasons. First, it is interesting from a theoretical basis if consumers make this trade off optimally. Many theoretical models in marketing and economics make the fundamental assumption that consumers equally weigh current and future events when making decisions today. Yet there is some evidence, mostly from laboratory experiments, that consumers underweight future events. I attempt to explore this question in a market setting where the stakes are considerably higher. This research adds evidence to the debate about how much weight consumers place on future events when making choices today. Second, it is interesting to firms making product design decisions. If consumers underweight future events, then when making purchase decisions, consumers will view operating costs as less important than the upfront capital cost of the product. Finally, the answer to this question informs public policy. Many have argued that there is a need for the US to reduce gasoline demand per capita. Lower gasoline consumption would reduce environmental pressures, potentially dampen inflation, and allow more foreign policy flexibility in dealing with antagonistic regimes in oil-exporting states. While these rationale for reducing gasoline consumption have a normative flavor, and reasonable people may disagree as to the validity and motivations of this goal, it will nonetheless be useful to know the relative effectiveness of different policy levers in curbing gasoline consumption. For example, if consumers underweight fuel costs during the vehicle purchase decision, then a gas tax will be relatively less effective than a tax on gas guzzling vehicles. To study this question I develop a choice model of the automobile industry. I identify the weight the consumer places on capital v. operating costs by determining how much of the variation in automobile market share can be explained by variation in each of these two factors holding other product attributes constant. We use data from the period 1971-1990, a period over which gas prices and thereby operating costs experienced considerable variation. In order to model operating costs which are not known at the time of purchase, I account for the expectations of consumers about car usage and gas prices. I assume that consumers are aware that they will respond to changes in the gasoline prices with changes in their driving patterns. Consumers also know that gasoline prices are not stable, and need to form expectations about future gasoline prices at the time of the automobile purchase. To take account of this effect, I estimate an ARIMA model of US gasoline prices from 1960-1995, that is used as the by consumers in their expectations formation process. Taking car usage and gas price expectations together enables an estimate of future gasoline costs of operating the car in the future. I also account for consumer heterogeneity in miles driven, sensitivity to automobile price, and sensitivity to operating costs. Finally, I recognize that prices are not exogenously determined and attempt to model prices as market outcomes. Based on the results of the model developed, I find no evidence to support behavioral theories that consumers systematically underweight the cost of future events in real market settings. However, I find significant evidence that large portions of the population are not making the trade-off optimally. Some consumers underweight future operating costs (SUV drivers) while others appear to overweight them (hybrid drivers). Conservatively, at least 30% of the population is either drastically underweighting or overweighting operating costs when purchasing a new car. Chapter II addresses the question of whether consumers are willing to pay for corporate social responsibility(CSR). This question is important in an environment where CSR is ubiquitous, yet it is unclear that these programs actually pay off for the firms that sponsor them. For example, consider Target's program to donate 1% of all retail sales to United Way local charities. Do consumers really want their money spent this way? Are consumers happily paying 1% higher prices or are they switching to a competitor which does not donate a portion of revenues to charity? Who is making the donation in the end, Target's shareholders or customers? From a social planner's perspective, the point is largely moot, yet to the shareholders of Target and many other firms practicing CSR, the question is crucially important. I endeavor to study this question within the context of the coffee industry, an important and sizeable commodity market. In particular, I explore the impact of Fair-Trade (FT) certification on the retail coffee market. FT is a social and ethical movement that supports the ethical production of coffee and other products largely in third world countries. Coffee can be FT certified by adhering to FT standards. Once certified, FT coffee is distinguished from non-FT by distinctive labeling visible to the consumer who is deciding which coffee product to select from the supermarket shelf. The analytical strategy for this paper is to first estimate the price premium commanded by FT coffee over non-FT coffees through ordinary least squares (OLS) and Fixed Effects hedonic price regressions. However, these tools do not allow us to disentangle the portion of the price premium which is due to supply considerations (i.e., FT certification costs) from the portion which is due to consumers' willingness to pay for FT coffee because they want to support socially responsible coffee production. To parse out willingness to pay from the overall price premium, I specify a brand choice model similar to the model used in chapter I. Using hedonic price regressions I establish that FT coffee carries a price premium of $1.74 per 12-16 oz. It seems likely that at least a portion of this premium is due to increased consumer willingness to pay for FT coffee. However, I cannot rule out the possibility that the price premium is a result of the added costs associated with that FT practices. The choice model specified in this paper should enable the allocation of the cause of the price premium we have now established for FT coffee to demand v. supply considerations. I hope to estimate this model in future research. Chapter III addresses the problem of how durable or long lasting manufacturers should they make their products. On the one hand a more durable product will be more desirable to consumers, since it will provide benefits over a longer period. Thus, a longer-lived product will command a higher price. However, it seems likely that unit production costs will increase as a product is made more durable due to the increased cost of more reliable materials and more exacting quality standards. In addition, a product which is more durable will be replaced less frequently. Ceteris paribus, less frequent replacement is less desirable to manufacturers, as the periodicity of the revenue stream increases. Manufacturers can trade off the benefits of durability with the costs to determine the optimal reliability or life for the goods they produce. In some sense, this problem is a classic trade-off between quality and cost. What distinguishes the durable goods reliability problem is that increasing quality depresses replacement demand. A common anecdote is that light bulbs could easily be manufactured to last longer, but are not in order to increase replacement sales. This question is important for manufacturers to understand from several perspectives. First, a manufacturer of a product with technology that is fairly static (e.g., light bulbs), needs to consider replacement demand in developing product designs. When technology is not static (e.g., computers), it is important to understand how the rate of technology advance will stimulate replacement demand. Should the products be designed to be more or less durable in the face of technological advance? An additional complication arises when the rate of technological advance may only be partially observable to the consumer (e.g. golf clubs). Finally, manufacturers need to consider "buying back" used durable goods from the.
Author: John H. Dunning Publisher: Edward Elgar Publishing ISBN: 9781843767053 Category : Business & Economics Languages : en Pages : 546
Book Description
These volumes should be required reading for anyone with an interest in international business and globalisation. They add immeasurably to our understanding. Mira Wilkins, Business History Dunning is one of the most prominent researchers and thinkers in the IB field. In these books, he has set out his most celebrated writings and has provided us relatively easy access to widely scattered references in the literature. Rajat Kathuria, Global Business Review The modern academic study of the multinational enterprise started with John Dunning s pioneering study of American Investment in British Manufacturing Industry in 1958. In the early 1970s he began to publish an influential and authoritative stream of papers integrating theoretical and empirical analysis of the multinational enterprise. This fascinating volume charts the evolution of John Dunning s thinking, highlighting his attempts to develop a richer, more dynamic and historical framework for the analysis of the multinational enterprise. It makes compelling reading, and offers unique insights into the intellectual development of his well-known eclectic paradigm of international production. Mark Casson, University of Reading, UK This volume contains a selection of John Dunning s best known and highly acclaimed writings on the theory of international business activity. Spanning more than three decades, the 16 contributions trace the evolution of his thoughts and ideas as an economist, from his first article on the determinants of international production, published in 1973, to his most recent essay on relational assets, networks and global business activity, completed in 2002. Theories and Paradigms of International Business Activity gives particular prominence to the author s much renowned eclectic paradigm, which he first promulgated at a Nobel Symposium on the international allocation of economic activity in 1976. Since then, the author has written over 60 articles, pamphlets and chapters in books which have extended, refined and updated his theorizing on the interface between trade, FDI and MNE activity, in the light of the changing characteristics of the world economy and advances in international business scholarship. This, the first of two volumes of John Dunning s work, is essential reading for all students, scholars and researchers with a special interest in the reasons behind the explosive growth in post-war FDI and the globalization of business activity.
Author: Walter Baets Publisher: World Scientific ISBN: 9814544108 Category : Languages : en Pages : 338
Book Description
A tendency exists in management theory and practice today to accept that our linear and deterministic ways of thinking about managerial problems create more problems than they solve. In the field of strategy studies, for instance, one can observe a growing interest in learning and organisational flexibility — IT gives importance to distributed cognition and adaptive systems. Management theorists are keenly observing developments surrounding complexity and chaos theory in science, and management researchers are attempting to apply emerging theories to managerial problems.Although there are still a limited number of applications in the managerial world, the Santa Fe Institute and the Los Alamos Center for Nonlinear Studies (both in the US) have been active for several years in closely related fields and, more important, adopt a multidisciplinary approach. Such applied research is seldom present in academic management journals. It seems, however, that the business community is interested in the implications of chaos and complexity for management as well as adopting a multidisciplinary approach to strategy and organisational change.This volume, constituting the proceedings of the Summer School on Managerial Complexity, held in Granada, Spain, on 11-25 July 1998, will benefit students and researchers in chaos and dynamical systems.
Author: David S. Evans Publisher: Springer Science & Business Media ISBN: 0306476002 Category : Business & Economics Languages : en Pages : 486
Book Description
No antitrust case in recent history has attracted as much public attention as U.S v. Microsoft Corp. Nor has any antitrust case in memory raised as many complex, substantive issues of law, economics and public policy. Microsoft, Antitrust and the New Economy: Selected Essays constitutes an early effort to analyze some of the central issues and to put the case in the context of the ongoing debate over the role of government in managing markets - especially in technology driven New Economy industries. All of these essays, it should be noted, are written by critics of the government's efforts to regulate Microsoft. Indeed, many are by individuals who were closely involved in the company's legal defense and served as consultants to Microsoft. But their work should be judged on the merits rather than their provenance. For all represent serious scholarship by researchers committed to advancing the debate over government regulatory policies.
Author: Thomas A. Marschak Publisher: Springer ISBN: 3662404133 Category : Business & Economics Languages : en Pages : 340
Book Description
89 TABLE 5 USE OR PLANNED USE OF MAJOR ENGINES IN AIR FORCE AND NAVY AIRCRAFT a Engine Air Force Aircraft Navy Aircraft F-80, T-33, XF-92, YB-61, AJ2, F9F-7, TV-I, J-33 YB-62, F-94 (A, B), TM- T2-V, P4M-I 61 (tactical missile) X-3, XF-88 F3D, F2H, F6U, F7U J-34 F-84 (B, C, D, E, G, H) J-35 FJ-I B-45, XB-51, XF-9J, B-36, J-47 B-47, F-86 (D, F, K) J-48 F-94C F9F J-57 B-52, YB-60, F-lOO, A3D, F4D, F8U F-I02A, F-I0l (A, B), SNARK, F-105A, F-I07, KC-135A, B-57D, X-16 F-84F, B-57 FIIF, A4D, FJ-3, J-65 FJ-4, F9F YQ-l, YQ-2, T-37 J-69 SNARK, YF-89E, B-66 J-71 F-I01, F-I02B, F-I05, J-75 F-I07 F8U, XP6M B-58, F-I04, F-IOIA (see J-79 note c, Table 4) F5D, FIIF, A3J, F4H T-34 C-133A, YC-97J, YC-12IF R7V-2 XF-84H T-40 R3Y, XFY, A2D YC-130, YC-131C T-56 Note: a Aircraft in which engine was used or was planned to be used. For at least one (and generally more) of the aircraft in the list associated with a given engine, the decision to use the engine was made when the engine was in the final stages of develop ment. (In the case of the J -57, J-79, andJ-75 this is true of nearly all the aircraft listed.) No Jist extends beyond 1956. Summary For an engine developed independently of an airframe the de veloper may constrain the performance, weight, and size of an engine at the start.
Author: Paul Mizen Publisher: Edward Elgar Publishing ISBN: 9781781950777 Category : Business & Economics Languages : en Pages : 312
Book Description
Commenting on the quality of the contributors when opening the conference on which these books are based, the former Governor of the Bank of England, Sir Edward George, said "I cannot remember ever before having had such a galaxy of academic economist and central banking superstars gathered together under one roof!"' Celebrating the contribution that Charles Goodhart has made to monetary economics and policy, this unique compendium of original papers draws together a highly respected group of international academics, central bankers and financial market regulators covering a broad range of issues in modern monetary economics. Topics discussed include: central bank independence credibility and transparency the inflation forecast and the loss function monetary policy experiences in the US and the UK the implications of Goodhart's Law the benefits of single versus multiple currencies money, near monies and credit. Each chapter of the volume relates to subjects that have been research projects in Charles Goodhart's wide-ranging portfolio, and all are interconnected. Through these, the book offers a summary of current thinking and insights into monetary controversies. Covering recent thinking on monetary theory, central banking, financial regulation and international finance, academic and professional economists alike will find this book an invaluable source of information. The companion volume examines monetary history, exchange rates and financial markets.
Author: Hagit Perry
Author: Hagit Perry
Author: James Winslow Sawhill
Author: John H. Dunning
Author: Walter Baets
Author: David S. Evans
Author: Narayanasamy Ramasubbu
Author: Irma Adelman
Author: Gautam Mathur
Author: Thomas A. Marschak
Author: Paul Mizen