Events
Marketing Research Seminars
To attend any of the research seminars, or for further information, please contact Arlene Mitchell on +44 (0) 20 7000 8614 or email amitchell@london.edu
Forthcoming Seminars and events (to be confirmed)
Centre for Marketing Events 2007-08
Centre for Marketing Evening Seminars
Centre for Marketing Evening Programme
Previous Seminars and events in 2007-08
| 8 October 2007, 11.00 - 12.30 |
K Sudhir (Yale School of Management)
Optimal Inter-Release Timing for Sequentially Released Products
Marketers routinely use timing as a segmentation device through sequential product releases. While there has been much theoretical research on the optimal introduction strategy of sequential releases, there is little empirical research on this problem. This paper develops an econometric model to empirically solve the inter-release timing problem: it involves (1) developing and estimating a structural model of consumers' choice for sequentially released products and (2) using the estimates of the structural model to solve for the optimal inter-release time. The empirical application focuses on the motion industry, where we specifically address the issue of the inter-release time between a theatrical movie and its DVD version — a topic of great managerial relevance to Hollywood studios. The results from model estimation and policy analysis yield a number of interesting insights. In particular, we find that, given the consumer preferences and industry cost structure in our sample, the theater-DVD window that maximizes the industry revenue is about 2.5 months for an average movie.
| 22 October 2007, 11.00 - 12.30 |
Zsolt Katona (INSEAD)
Network Formation and the Structure of the Commercial World Wide Web
We model the commercial World Wide Web as a directed graph emerging as the equilibrium of a game in which utility maximizing Web sites purchase (advertising) in-links from each other, while also setting the price of these links. In equilibrium, higher content sites tend to purchase more advertising links (mirroring the Dorfman-Steiner rule) while selling less advertising links themselves. As such, there seems to be specialization across sites in revenue models: high content sites tend to earn revenue from the sales of content while low content ones from the sales of traffic (advertising). In an extension, we also allow sites to establish (reference) out-links to each other and find that there is a general tendency to establish reference link to sites with higher content. Finally, we explore network formation in the presence of search engines and find that the higher the proportion of people using these, the more sites have an incentive to specialize in certain "content areas". Our results have interesting practical implications for `search-engine optimization', the pricing of online advertising as well as the choice of Internet business models. They also shed light on why Google can use the Web's link structure to rank sites by content.
| 10 December 2007, 11.00 - 12.30 |
Asim Ansari (Columbia Business School)
Modeling Online Relationships in Social Networks
Over the past few years, online social networks have become increasingly popular. Apart from the very big general networks such as Myspace and Facebook, many specialized networks have emerged catering to the interests of particular communities of web users. Social networks facilitate interaction among people who share common interests. Such networks include communities that facilitate transactions, communities of interest and relationships, and communities of fantasy. Businesses are becoming increasingly interested in harnessing the marketing potential of these networks. Apart from the wealth of information that is available from each member, social networks also offer a unique view of the strength of relationships among the members. A clear understanding of the determinants of relationship formation between pairs of users can allow marketers to leverage the network for targeting, persuasion and communication purposes. In this paper we use a Bayesian framework for modeling multiple relationships among the members of a social network. Data on social relations has a complex covariation structure owing to the presence of each individual across multiple dyads. In addition, data is often sparse because most actors have few ties. Bayesian models can accommodate these and other structural properties such as homophily, reciprocity and transitivity of relations within the social network. We use data from an online network of music artists and model three relationship dimensions (friendship, communication and music downloads) among different pairs of artists. These three relations offer a combination of directed and undirected, and binary and non-binary relationships that need to be modeled appropriately. Our results allow us to distinguish the differential impacts of different dyadic and artist-specific factors on the formation of these three relationships.
| 14 January 2008, 12.00 - 13.30 |
The Mere Choice and Mere Neglect Effects
From web pages to branded video games to store shelves in supermarkets, consumers visually select specific objects as the targets of their actions, while avoiding and neglecting others. We propose that the simple act of selecting (neglecting) a product – independent of intrinsic preference or consumption experience – makes it more (less) likely that it is later chosen. We build on Raymond, Fenske, and Tavassoli (Psychological Science, 2003) who found that selective attention moderated the evaluation of novel visual stimuli. What was unclear, however, was whether it was the act of selecting or the act of neglecting a stimulus that moderated evaluation (although they argue for the latter). We demonstrated that, compared to a mere exposure baseline (exposure without selection), the choice of both stimuli selected for attention and response, as well as that of non-target stimuli simultaneously neglected is moderated by selective attention. Moreover, compared Raymond et al. who had only a brief delay between selection and evaluation, we find that the effect is based on long-term memory. The mere choice and mere neglect effects were stronger the more often a stimulus was selected (neglected) prior to choice. These findings suggest, for example, that arbitrarily (not) choosing a product on one occasion makes it (less) more desirable the next time. In other words, mere choice and mere neglect can differentiate commodity products.
| 28 January 2008, 12.30 - 14.00 |
Marco Bertini (London Business School)
Money Muddles Thinking: The Effect of Price on Preference Consistency
In this research we study the possible role of price in impeding consistent, transitive choice behavior. Our hypothesis is that price makes buying decisions less transitive because the hedonic representation of price onto utility is inherently ambiguous. This claim stems from the notion that people derive pleasure (or pain) from money without carefully computing what they actually plan to buy with it (Camerer, Loewenstein, and Prelec 2005). The results of four experiments provide convergent support for the predicted effect. In addition, we show that the phenomenon is robust to different preference elicitation methods, persists even when participants are simply asked to consider how much a product might cost, but vanishes when a numerical attribute has a different label (e.g., a quality rating). Ironically, while money degrades consistency, participants reported greater confidence in their decisions when prices were quoted.
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Bruce Hardie (London Business School)
Customer-Base Analysis Using Repeated Cross-Sectional Summary (RCSS) Data
A number of researchers have developed models of repeat buying behavior that can be used as a basis for computing quantities of managerial interest such as customer lifetime value. The Pareto/NBD is an example of such a model. These models typically require that the analyst have access to individual-customer-level data. However, this is not always practical. While many reporting systems are able to create simple data summaries for a fixed period of time (e.g., a quarterly histogram of number of purchases), the process of extracting raw individual-level data can be a time-consuming task. The mere process of physically transferring raw customer-level data can be risky, as a number of privacy-related news stories attest. And in many countries, data protection laws can complicate the process of transferring raw data to the analyst, especially when the analyst is located in another country. This research explores the possibility of estimating these models using repeated cross-sectional summaries of the transaction data (e.g., four quarterly histograms), focusing on the case of the Pareto/NBD model. (Such summaries are easy to create, are easy to distribute, and are free of any privacy concerns.) In particular, we examine i) how much "information" is lost when fitting the model to these repeated cross-sectional data summaries data instead of the raw individual-customer-level data, and ii) the number of cross-sections required to minimize information loss. We carry out a comprehensive simulation study covering a vast spectrum of market scenarios characterized by various levels of customer base penetration and purchase frequency. Across most of these datasets, our results consistently establish that the model fit associated with the use of RCSS data can closely match that associated with individual-customer-level data. These simulation results are confirmed in an analysis of data from the online music site CDNOW.
| 11 February 2008, 16.00 - 17.30 |
Marcel Zeelenberg (Tilburgh University)
On the Motivational Function of Emotion and its Impact on Decision Making: A Feeling is for Doing Approach
Emotions are signals to ourselves that important events or outcomes occur or are about to occur. As such, emotions are motivational states that prioritize behavior that deals with the occurrence of these outcomes or events. The core idea in my presentation is the variety of feeling states exists for the sake of behavioral guidance. The specific behaviors that follow can be understood one realizes that emotions have these motivational functions. I refer to this as "feeling is for doing" and with this I mean that each emotion has its idiosyncratic experiences and motivations attached to it. I will illustrate this approach with examples of our own research in which we show that guilt and shame have different effects on cooperation and that these can be understood in terms of their motivational function.
| 25 February 2008, 16.00 - 17.30 |
Klaus Wertenbroch (INSEAD)
The Costs and Benefits of Temptation in Consumer Choice
The literature on consumer self-control focuses on the costs of facing tempting choices. Resisting temptation requires expending willpower (ego depletion) or constraining one's choice set (precommitment). In contrast, we propose that temptation may entail not only costs but also benefits that arise from what a choice tells consumers about themselves. Succumbing to temptation is a (costly) signal of weak willpower, whereas resisting temptation is a (beneficial) signal of strong willpower. Importantly, these self-signaling costs and benefits depend not only on the chosen item but also on the non-chosen options in the choice set. A series of five experiments involving choices between tempting vices and unappealing virtues shows that the self-signaling value of the non-chosen options in the choice set (1) enhances or reduces the utility of the chosen item and (2) prospectively affects consumer preferences among the choice sets themselves. We discuss theoretical implications of our findings for research on impulsive choice and self-control and on self-signaling and managerial implications for pricing and assortment strategies.
| 3 March 2008, 14.00 - 15.30 |
Bernd Skiera (Goethe University)
Optimal Bidding and Optimal Agency Compensation in Search Engine Marketing
Search engine providers use keyword auctions to sell their advertising space so that advertisers have to bid to place their ads. We develop a model for optimal bidding, which maximizes the advertisers' profit, and present the empirical results of an applicatin of the model. Additionally, we analyze the profitability of popular bidding heuristics like "bid so that the ad is always placed on rank 3 in the sponsored links area" or " never pay more than 2 € per click". Finally, we show that a frequently used performance-oriented compensation plan, which is based on a fee per acquired customer, does not provide enough incentives for agencies to bid according to the advertisers' objectives. We therefore propose an improved compensation plan which guarantees the compliance of agencies' bidding behavior and advertisers' objectives.
| 21 April 2008, 16.00 - 17.30 |
Puneet Manchanda (University of Michigan)
An Empirical Analysis of Individual Level Casino Gambling Behavior
Gambling and gaming has evolved to become a very large and pervasive industry in the Unites States over the last three decades. The industry is worth over $73 billion in revenues. Participation in this industry is around one-third of all adult Americans. The nature of this industry and its rapid growth has led to a lot of debate about its benefits and costs. In this research, our access to a rich and new dataset on individual consumer behavior vis-a-vis casino visitation and activity allowed us to take a data based approach to investigating some of the commonly made arguments about these benefits and costs. We focused our attention on one of the commonly cited costs of gambling i.e., that it leads to addictive behavior (with potentially harmful individual and societal effects). We used the commonly accepted definition of addiction from the economics literature to test for its presence i.e., that current consumption is affected by past consumption. We fitted a model of the play decision and bet amount to data from a consumer panel of casino visitors over a two-year period. Our data are at a highly disaggregate level - we looked at play decisions within a given trip for individual consumers. Our modeling approach allowed us to exploit the rich variation in the data both across and within individuals. Our results show that, controlling for other reasons that could induce play, only about 7% of all consumers show evidence for addiction. While this proportion may look small, it is consistent with research carried out in other domains that has focussed on casino gamblers. In addition, we found no evidence for either the hot hand myth or the gambler's fallacy. An interesting (though indirect) implication of our analysis is that casino gambling seems to be another form of entertainment for the non-addicted consumers. This research can also be seen as more descriptive in terms of the role of marketing in this industry. We found that marketing activity has a positive effect on the decision to play and the amount to bet. In terms of effect size, comps seem to be more similar to advertising rather than price promotions. Finally, we found some weak evidence that marketing activity is more effective for consumers who exhibit more addictive behavior.
| 28 April 2008, 16.00 - 17.30 |
Catarina Sismeiro (Imperial College)
Using Image and Text-Related Features to Improve Offer Targeting
Technical developments have opened new channels for direct marketing, including email and mobile phone messaging. These new channels face specific challenges in the implementation of effective offer targeting. For example, in many applications the number of new offers available grows faster than the learning opportunities. Under these circumstances, marketers might not have enough time or occasions to learn the potential performance of all available offers, preventing adequate targeting. We propose a two-phase approach to improve targeting when such constraints are present. Our approach takes advantage of the image and text of each offer (together with its price) to decide which offers should be subject to further testing. Image- and text-related features are extracted automatically using algorithms from the image processing and text-mining literatures. These are scalable algorithms that can be employed in large-scale studies of image and written stimuli. Subsequent testing will then follow the pre-testing traditionally employed in direct marketing applications in which the (screened) offers are systematically sent to a limited sample of potential buyers and ranked based on their sample performance. We tested the proposed approach using data on commercial mobile messaging. Our results revealed that, in the given domain under study, the proposed approach outperforms the approaches currently used by the industry. We discussed several simulation experiments we performed, compare the performance of alternative methods, and discussed how direct marketing firms can exploit the information on visual and text content (together with the offerings' price) to optimize learning and targeting.
| 19 May 2008, 16.00 - 17.30 |
Elizabeth Cowley (The University of Sydney)
Retrospective Evaluations: Changing the Photos in Episodic Memory's Photo Album
Daniel Kahneman provides an instructive analogy when describing how he believes people retrieve information from episodic memory and construct retrospective evaluations. He suggests that people do not re-play a video tape of an event, instead they select salient snapshots to construct their memory for the experience. However, the snapshots in episodic memory's photo album may change over time. Research has shown that salient episodic details may be distorted after the initial experience with misleading questions, other consumers' reports of the same event, and misleading post-experience information such as advertising. A series of studies will be presented that evidence that consumers passing on word-of-mouth inadvertently results in changes to the photos in the album and that consumer's post-experience behavior alters retrospective evaluations. In addition to the fading, exchanging, and synthesizing of the photos themselves, consumers may be motivated to strategically select snapshots to create a retrospective evaluation. Studies will be presented which reveal that motivated consumers construct retrospective evaluations to justify repeating an activity.
| 9 June 2008, 16.00 - 17.30 |
Baba Shiv (Stanford University)
Are Emotions Beneficial or Detrimental to Decision Making: A Neuroscience Perspective
The broad goal of this session is to highlight the important role that brand emotion plays in the Customer Value Proposition (CVP). The presentation will begin with a brief introduction to the traditional "first wave" and "second wave" views of the CVP. It will then focus the emerging "third wave" view, where brand emotion plays a crucial and fundamental role in the value proposition. Here, we will delve into some startling and counterintuitive insights being unraveled from neuroscience on the workings of the human brain, particularly the role of emotion in the customer decision making process. The presentation will finally segue into the "so what" detailing the strategic and tactical
| 23 June 2008, 16.00 - 17.30 |
Harald van Heerde (Waikato Management School)
A Cross-Continent Study of the Drivers of Consumers' Willingness to Pay a Price Premium for National Brands over Private Labels
The authors conduct a cross-country, cross-category study into the drivers of consumers' willingness to pay a price premium for national brands over private labels. They specify an economic model that expresses the price premium that consumers are willing to pay as a function of the perceived quality gap between national brands and private labels, sensitivity to quality, sensitivity to price, perceived uncertainty about the utility provided by national brands, perceived uncertainty about the utility provided by private labels, and risk aversion. Hypotheses on the impact of category, consumer, and country characteristics on the model parameters are tested using Bayesian methods on a survey from 22,623 consumers from 23 countries on four continents. The authors then discuss strategies national brand managers can use to maintain or increase consumers' willingness to pay a price premium for their brands.
Research Seminar Archive 2006-07
For further details of these and other events, please refer to the Events calendar
