Assessing Consequences of Component Sharing across Brands in the Vertical Product Line in the Automotive Market

Component sharing may look great in the boardroom but not in the showroom. Indeed, savings on research and development and production costs could be offset by a plunge in customer brand attractiveness. The central objective of this paper is to investigate consumer and market responses toward component sharing between brands. More specifically, by combining experimental with econometric studies, this paper investigates the impact of component sharing on customer evaluation of luxury, volume, and economy brands offered in a car manufacturer's vertical product line. An experimental study in which component sharing between automotive brands was made explicit aimed to understand the impact of brand combinations and type of sourcing on the evaluations of the two brands sharing components. This experimental study shows that the evaluation of luxury brands sharing with a volume brand suffers more than when a volume brand shares components with an economy brand. This experimental study was executed for two different brand combinations including one luxury, one volume, and one economy brand: (1) Audi, Volkswagen, and Skoda; and (2) Lexus, Toyota, and Suzuki. The evaluation of an economy brand benefits more from sharing with a volume brand than a volume brand suffers from sharing with an economy brand. The magnitude of these effects depends on several factors, such as component type, the source of the component sharing, and the salience of component sharing to the consumers. One important limitation of the experiment is that component sharing is made rather salient, and no behavioral effects of component sharing are studied. Therefore, a second was executed in which market share data on brands of the Volkwagen company (i.e., Audi, Volkswagen, Seat, and Skoda) were collected, while also data on the component‐sharing practices between these brands were gathered. A market share model was estimated in which market shares of the four studied brands were explained by component‐sharing practices and some control variables (i.e., price, model changes) in an exploratory fashion. The explorative examination of market share effects confirms that luxury brands may suffer, while economy brands may benefit from component sharing. In sum, this research suggests that component sharing between brands has negative effects for the higher‐end, and positive effects for the lower‐end brand. However, it also shows that sourcing matters. This study is considered as the first study investigating the phenomenon of component sharing, and it points to multiple future research issues, such as studying this phenomenon in other markets.     

Data accuracy's impact on segmentation performance: Benchmarking RFM analysis,logistic regression,and decision trees

Companies greatly benefit from knowing how problems with data quality influence the performance of segmentation techniques and which techniques are more robust to these problems than others. This study investigates the influence of problems with data accuracy – an important dimension of data quality – on three prominent segmentation techniques for direct marketing: RFM (recency, frequency, and monetary value) analysis, logistic regression, and decision trees. For two real-life direct marketing data sets analyzed, the results demonstrate that (1) under optimal data accuracy, decision trees are preferred over RFM analysis and logistic regression; (2) the introduction of data accuracy problems deteriorates the performance of all three segmentation techniques; and (3) as data becomes less accurate, decision trees retain superior to logistic regression and RFM analysis. Overall, this study recommends the use of decision trees in the context of customer segmentation for direct marketing, even under the suspicion of data accuracy problems.     

Sexual Harassments: Criteria for difining hostile enviorment

Sexual harassment in the workplace continues to be one of the most controversial and complex legal and ethical issues facing empolyers. The U.S. Supreme Court's June 1986 decisiion inMeitor Savings Bank v. Vinson, which applied Title VII of the Civil Reights Act to situations involving sexual harassment, is discussed. The Court's definition of hostile environment is reviwed, and federal court cases interpreting the Supreme Court's pronousncements are examined. The cases provide guidance on the kinds of situations that result in employer liability for sexual harassment. A primanry conclusion is that employers may easily avoid liability by exercising learned judgment and sound management practices.     

Telecommunications, an instrument of radical change for both the 20th and 21st centuries

This paper compares and contrasts how entrepreneurial disruptions, firm innovations, foreign market expansion and government restraint interact during three distinct periods to create and dramatically expand one service—telecommunications. Because this service has the ability to help business overcome the frictions of time, it has become both an enabling and lead technology in the dramatic economic growth. Telecommunications was instrumental in ushering in the formation of the third Kondratieff long Wave upswing at the beginning of the 20th century and appears to be important in jumpstarting the emerging information economy in the fifth Kondratieff Wave at the end of the 20th century.     

The development and evaluation of an andragogic training programme for small business retailers

One of the greatest challenges facing South Africa after apartheid is job creation and the development of people's skills. Small business, and retailing in particular, with its relatively low entry requirements, can help to meet this challenge. However, small business retailing suffers from a high failure rate.

It was felt that small business retailers would be more likely to succeed if they received proper training. A small business training model was therefore developed and implemented and the results were evaluated from several perspectives. This indicated that if small business retailers are effectively trained their knowledge and skills will improve and their businesses will be more likely to survive and grow. The article describes the model, the systematic approach to the training, the methods of evaluation and the lessons to be learnt from the exercise.     

Revenue Effects of Tax Facilities for Pension Savings

Many countries have tax facilities for pension savings. These facilities are often associated with the application of the cash-flow treatment of pensions: pension contributions are tax-exempt, capital income of pension funds is tax-exempt, and pension benefits are taxed, but usually at a relatively low rate. This paper investigates the revenue effects of a cash-flow tax regime for pension savings by full present-value calculations. A comprehensive income tax system is used as a benchmark. We present an empirical analysis for the Netherlands as a typical example of a country with funded pensions. Our calculations show that current taxation of pensions implies a major tax revenue loss. For the year 2003, we estimate a fiscal pension subsidy of 1.4% to 1.5% of Gross Domestic Product (GDP).

‘Sustainable transport choices’ in consumer shopping: a review of the UK evidence

In the UK, as elsewhere in Europe, government policy aims to reduce the use of private cars for consumer shopping trips. One major instrument of policy aims to ensure that new retail development is located in places accessible by all transport modes. This paper reviews the effectiveness of this and other such policies through analysis of survey evidence relating to routine shopping behaviour in the UK. It appears that these policies are likely to have little impact upon shopping travel, given the advantages to the consumer of private car use. However, demographic trends and increasing use of the Internet for food shopping are likely to stabilize or even reduce the use of private cars in the future.     

Ex Ante Impact Assessment under Imperfect Information: Biotechnology in New Member States of the EU

Some argue that the lack of modern agricultural development in the former socialist countries of Central and Eastern Europe has made cutting‐edge biotechnology attractive. However, enthusiasm for planting genetically modified (GM) crops varies greatly in the enlarged European Union (EU) and especially among the New Member States (NMS); the Czech GM maize area is progressively growing whereas Hungary imposed a de facto ban on GM crops. Remarkably, the Hungarian ban was not supported by any cost–benefit assessment. In the literature, ex ante impact assessments of monopolistically priced technologies are often based on cross‐sectional comparisons of average cropping budgets. Such assessments ignore heterogeneity of farmers and underestimate the true impact of these technologies because of homogeneity bias. Therefore, we propose an improved method by explicitly modelling farmer heterogeneity under imperfect information, and assess the potential value and benefit sharing of GM crops in the two NMS using a stochastic partial equilibrium model. The total potential value of GM crops is estimated at €82 million for both countries, of which €60 million (73%) accrues to farmers and €22 million (27%) to the gene developers and the seed industry. This is in line with the literature on global benefit sharing of first‐generation GM technologies.