Analyzing price and product strategies with a comprehensive system dynamics model—A case study from the capital goods industry

Price reductions and/or product enhancements are widely seen as appropriate ways to increase market share. However, the key findings of this analysis demonstrate the opposite: decreases in price combined with product enhancements can lead to substantial loss in sales revenue and, ultimately, profit. The discussion draws on findings from a comprehensive system dynamics model, which has been developed in a major company in the capital goods industry. The purpose of this research is to analyze the price and product strategies in the capital goods industry. In the case company, testing intuitive beliefs with the help of a formal system dynamics model proved to be beneficial in the strategic decision-making process. The model had a significant impact on the case company, especially when challenging basic assumptions about mechanisms of markets and competition.     

Managing price expectations through product overlap

How should a retailer think about the decision to carry, price, and promote products that overlap with another store when such overlap is predicted to intensify price competition and drive down product prices? The existing research suggests that retailers should look to carry an ever-increasing percentage of unique or non-overlapping products [J. Marketing 61 (1997) 38; Marketing Sci. 19 (2000) 83], thereby eliminating the ability to compare prices across stores.We challenge this recommendation, arguing that overlapping products allow one type of retailer—the higher end retailer—to signal the fairness of its prices and foster a more favorable price image than might otherwise exist. In a laboratory study, we show that, for higher end stores, the existence of overlapping products can significantly increase perceptions of pricing fairness and subsequent store choice, even when those overlapping products are no cheaper in the focal store than in a competing store.     

Technology gap,imported capital goods and productivity of manufacturing plants in Sub-Saharan Africa

This paper uses firm-level data from Ghana, Tanzania and Kenya to examine the effect of capital goods imports on domestic firms' productivity, and the role firms' technology gap plays in aiding the transmission of knowledge embodied in capital goods to domestic firms. The results show that increasing imports of capital goods and closing technology gaps have positive effects on productivity. Furthermore, domestic firms with technology standards farther from international best practices benefit more from capital goods imports. The results also imply that trade liberalization policy aimed at eliminating tariffs on capital goods will significantly improve the performance of technically incompetent firms in the African manufacturing sector.     

The effect of income growth on the mix of purchases between disposable goods and reusable goods

With each passing year consumers find more and more disposable goods for sale in the market place. Even goods that were considered to be reusable goods just a few years back are now disposable goods. As a result the American economy has been labelled a ‘throwaway society’. This paper examines a main underlying cause for this trend by linking growth in consumer income with the purchases of disposable goods. More specifically, the model proposes that as incomes rise, consumers will purchase more of both reusable goods and disposable goods. However, as incomes rise, consumers will naturally substitute purchases away from reusable goods and into disposable goods. The shift towards disposable goods occurs because it becomes too costly for consumers to spend their time repairing and maintaining products. Their time is better spent in more productive endeavours. It is simply cheaper (in terms of opportunity cost of time) to dispose of old products and replace them with new products.     

Brand name suggestiveness: a Chinese language perspective

The selection of the right brand name is one of the most important marketing decisions and brand memorability has been proposed to be one of the key brand name selection criteria. Prior brand naming research has primarily dealt with word-level analysis in examining English brand name characteristics that are desirable for improving brand memorability. In this regard, this research examines the effects of suggestiveness at both the word and sub-word levels on consumer responses to Chinese brand names. Through two experiments, the findings demonstrate the ability of both character-level and radical-level suggestiveness in improving the memory for brand name and target claim. This research also extends the findings of previous studies on suggestiveness by demonstrating its favorable attitudinal effects. Based on these findings, theoretical and managerial implications are discussed.     

Managing the transition to the new agile business and product development model: Lessons from Cisco Systems

Through an in-depth case study of Cisco Systems, this Executive Digest finds that companies face two broad challenges when transitioning to the agile product development model. The first is identifying and helping business units and engineering teams adopt this method; the second is developing new management practices that are compatible with and can sustain the agile development practices. Although extant literature has conducted many analyses on these two challenges, there still exist gaps in the research of the agile development method. Herein, we explore how Cisco Systems addressed these two challenges followed by a discussion of the broad implications of adopting the agile development method. This research deepens our understanding of how to adopt and lead the agile development process.     

The different roles of product originality and usefulness in generating word-of-mouth

This paper explores how the dimensions of new products, specifically, the originality and usefulness of the products, influence word-of-mouth (WOM). In four studies, using lab and field setups, we find that originality and usefulness have different effects on WOM. We show that consumers spread more WOM about original products, but the valence of what they say depends on the usefulness of the product. Therefore, originality enhances the effect of usefulness such that consumers spread relatively more and more positively valenced WOM about original and useful products compared to less original but equally useful products. Conversely, consumers spread more and more negatively valenced WOM about original products that are not useful compared to less original products with the same level of low usefulness. The results indicate that product originality should be managed carefully when developing and positioning new products. Although originality increases buzz, it might lead to negatively valenced WOM when the usefulness of the product is perceived to be low.     

植入式广告在广播中的运用

植入式广告在影视和网络游戏中渐入佳境,而在广播中尚待开发,有关广播的植入式广告的理论探讨还是空白。本文针对植入式广告在广播中的运用进行了探讨,并提出实务过程中需要注意和解决的问题。     

Using social and economic incentives to discourage Chinese suppliers from product adulteration

The American public raised serious concerns about product safety in 2007, when the number of product recalls broke a new record. Following a temporary drop in 2008, both the number and retail value of recalled units have been increasing, despite various efforts exerted by government agencies and private companies to combat this trend. Currently, many countries—including China itself—are expressing serious concern over adulterated or unsafe food made or sold in China. What are the underlying reasons for some Chinese suppliers to adulterate product? When law enforcement is still weak in China, what can western manufacturers do to reduce the risk of product adulteration? To develop effective deterrence mechanisms, we first identify four underlying factors that create incentives for some Chinese suppliers to produce unsafe products. Then we propose ideas to discourage Chinese suppliers from producing adulterated products based on two underlying strategies: (1) creating economic incentives through contingent payments, and (2) creating a social incentive by threatening public exposure through the power of the Internet and social networking sites.     

Assessment of the road safety performance of four roundabouts in Kumasi,Ghana

Upgrade of the Ejisu-Kumasi section of the N6 saw the construction of roundabouts at selected intersections. Their use appears challenging particularly for vehicles with elevated Centre-of-Gravity. The objective of this study was to establish the relative risk of traffic accident deaths or hospitalized injuries at the roundabouts. Five-year crash data covering a 100 m stretch upstream and downstream of the roundabouts were analysed. A total of 119 crashes occurred with 18% casualty hospitalization and 12%fatalities. Compared with the Ejisu roundabout, fatal or hospitalized injuries were significantly higher at the Boadi (OR = 25.6, p = 0.0021) and Kwame Nkrumah University of Science and Technology Police Station Junctions (OR = 48.2, p < 0.001). Occupants of buses, heavy goods vehicles and riders of two wheelers were at elevated risk of deaths or serious injuries. Crash severity at the round abouts was aggravated by night-time, steep gradients and adverse cambers. It is recommended that, signalization and grade separation should be used in the current arrangement where appropriate.     

A review of national arrangements for consumer influence in product safety standardization in the EEA

Abstract

Cooperation between the EC and the EFTA countries in the European Economic Area (EEA) should, among other things, enable consumers to participate in and influence standardization. The EC New Approach presupposes the elaboration of standards to interpret or fill out the special safety provisions of various directives. The notion of safe products according to the Product Safety Directive can be supported by drafting relevant safety standards. Swedish experiences in some product fields show that results can be achieved through expert consumer participation. Consumer influence on standardization is a matter of great importance for product safety in the future.     

Safety in the making: Australian product safety for the year 2020

Abstract

This paper is a summary of a report prepared by the author for the Australian Consumers Council that advises the Australian Minister for Consumer Affairs. The purpose is to consider the state of play in product safety management around the world and to suggest a strategy which Australia might implement considering international developments. The inter-nationalisation of product safety matters, the creation of global markets and the harmonisation of standards are key factors which must be taken into account when developing a product safety management system.

A small country like Australia will need to develop effective ways of interacting with the researchers and policy makers of the world to avoid duplication of effort and to contribute to international standards and policies. In the short term the following key recommendations are made:

? the establishment of a Consumer Safety Institute with a research and development role but no enforcement role,

? a review of the technical merit, currency, coverage and mechanisms for development of standards relating to product safety,

? routine reporting of product safety complaints and actions taken by manufacturers,

? the development of efficient mechanisms for assessing the safety of imports into Australia and

? an active strategy for managing and participating in international responsibilities related to product safety.     

Interactive effects of country of origin and product category on product evaluations

This research examined the effects of country of origin and product category on product evaluations for 21 countries and 18 products. As hypothesized, product evaluations were highest for highly-developed countries, followed by newly-industrialized, newly-marketizing, and developing-country groups. Further, the product-category and country-of-origin effects interacted such that, depending upon the country group, different product categories received more, equal, or less favorable evaluations compared to other product categories. Several variables and processes underlying these effects are identified and integrated into a conceptual model.     

论中国企业危机发生根源与处理技术

在当今复杂多变的市场环境中,中国企业所面临的各种危机随时随地可能发生。然而,由于企业管理者对危机的根源认识不足,而且所采用的处理技术相对落后,危机管理的效果不佳,给企业带来了致命的伤害。如果企业能够在危机发生之时,认清其根源,做出科学的决策,采取有效的处理技术加以泰然处之,那么很多危机或其危害就可以被及时消除或降低,从而使企业能够从危机中生存下来,实现长期可持续发展。     

Consumer ethnocentrism,product necessity and quality perceptions of Russian consumers

Retail buyers in Russia have indicated that some customers have expressed a desire to purchase domestically produced products over imports. Consumer ethnocentrism has been proposed as a measure to provide retail buyers with the information necessary to market to these consumers. The purpose of this research is to determine if perceived product quality of products differs based on country of origin, product necessity and consumer ethnocentric tendency. A repeated measures ANOVA test indicates that perceived quality differs by necessity, by product, by country. A consumer ethnocentrism effect on the overall model, however, was not significant. We conclude that Russian consumers do perceive differences in product quality based on country of origin and product necessity, but that consumer ethnocentrism does not have an effect on perceived product quality.     

The evolution of interorganizational relationships in emerging ventures: An ethnographic study within the new product development process

Emerging ventures rarely have the resources they need, which often force them to reach beyond their boundaries to access these resources. While the field has acknowledged how critical external relationships are in the emergence process, we lack an understanding of how these relationships evolve. Drawing on fourteen longitudinal case studies, this article begins to fill that gap by examining how emerging ventures use interorganizational relationships to discover, develop, and commercialize new products. We found that emerging ventures tended to establish outsourcing relationships early and that many outsourcing relationships progressed into alliances. This suggests that these early relationships are dynamic, evolve through the emergence process, and may be critical to the successful emergence of a venture. We also discovered that many entrepreneurs developed strong socioemotional bonds with their alliance partners. Unexpectedly, our study revealed that in many cases these socioemotional bonds clouded the entrepreneur's judgment of the partner's abilities and led to problems that threatened the venture's survival.     

IPTV(网络电视)广告类型和产品类型的广告效果

在本研究中,从IPTV作为一种新媒体的角度,根据不同的IPTV广告类型和产品类型存在的效果差异进行探索。为此,依据广告类型和产品类型的不同分别进行了4个实验调查,IPTV广告效果测定了广告态度、广告点击意向、产品购买意向。首先,由于IPTV广告种类的不同,使广告效果的差异表现在广告态度和点击意向上;第二,根据产品类型的不同,IPTV广告效果也出现了差异。在广告态度和点击意向及购买意向存在差异的同时,IPTV广告中探索研究比经验型研究显示出更有效的反应;第三,由于广告类型和产品类型的不同,相互作用效果在购买意向上表现了出来。这些为广告中利用IPTV的媒体两面性提供了依据;其次,倡议在广告实行战略中开发能预期对消费者起到积极广告效果的带有图标和字幕的网幅广告;再次,在IPTV广告的制作方面,为探索性的IPTV广告能够诱发更有效的广告效果提供了理论性的依据。     

Placing snacks in children's movies: cognitive,evaluative, and conative effects of product placements with character product interaction

ABSTRACT

Type of placement integration has been shown to influence placement effects in adults. However, no studies have explored the role of character product interaction (CPI) for product placement effects on children. We also lack knowledge about the moderating role of age in this context. We therefore exposed N = 363 children aged 6–15 years to a movie containing no placement, a static placement, or a CPI placement. The presence of placements affected cognitive and conative brand outcomes. However, children's product memory and consumption were higher for CPI placements compared to static placements. As a relevant implication for product placement research, we found that brand outcomes were independent of the children's ages and prior movie familiarity. This suggests that children's developmental stage concerning age does not mitigate product placement effects. Implications for educators and consumer advocates are discussed.     

Evaluation of performance in a product development context

In today's competitive environment, the need is greater than ever to deploy product development investments more effectively. To assist managers, we have developed two conceptual tools to support the evaluation of performance in product development. The Performance Measurement Evaluation Matrix (PMEX) helps managers evaluate performance measurement systems they currently use, in order to identify areas requiring improvement. Results from using the PMEX indicate that it is common to associate performance measurements with the efficiency aspects of time, cost, and quality, without monitoring the value created. Performance is largely perceived by managers in terms of time, cost, and quality of the activities in the later phases of the development process. We contend that an effective performance measurement system is based on performance criteria, and then derives measurements based on these. It is argued that there should be a change in the perception of performance, before performance evaluation systems can be improved. The Product Development Organizational Performance Model (PDOPM) assists in developing the perception of performance by relating uncertainty, efficiency, and effectiveness at three generic activity levels within the product development function. The use of our tools provides an improved perception of performance and its measurement, thus enabling improvements to the evaluation of performance.     

The effects of gender on processing advertising and product trial information

Consistent with past research and theory explaining gender differences in information processing, the empirical study reported here showed that men process two forms of marketing information (advertising and product trial) differently than women. Specifically, women are more sensitive to the comprehensiveness of the trial information, recognizing manipulated differences in trial diagnosticity. In contrast, men tend to use readily available information to form brand judgments and are less likely to notice that other attribute information is unavailable in the product trial.