What price loyalty? A fresh look at loyalty programs in the credit card industry

There is controversy about the effects of loyalty programs in the customer relationship management literature. Although some managers and researchers believe that customer loyalty created through loyalty programs leads to higher firm profits, others have found evidence that loyalty programs do not have a positive effect on firm's profits. In this article, we present our findings regarding the effect of reward cards and affinity cards on customer profitability in the context of credit card industry. We find surprising evidence that customers who own either a reward card or an affinity card generate significantly less profit than those customers who do not have these cards. Equally puzzling is the fact that these customers also have lower average lifetime with the firm. This leads us to a puzzle as to why these practices are widely prevalent in the industry. We find that loyalty cards provide value to the issuers in terms of risk management. They serve as a mechanism to reduce the risk associated with more profitable customers by attracting less risky customers. Thus, through loyalty cards the financial institution is able to balance out the total risk of the portfolio of customers by acquiring customers, who although less profitable, are less risky.     

A Note on the Public Interest and Ethical Behaviour

The Joint Code of Professional Conduct of the Institute of Chartered Accountants in Australia has made the protection of the public interest the primary responsibility of chartered accountants. We argue that the traditional accounting practices to safeguard the interests of clients and employers are likely to be contrary to the public interest and represent unethical behaviour in terms of the code. We also argue that although there may be breaches of the code they are unlikely to result in disciplinary action as there is a low probability of complaints against members of the Institute.     

Responding to public and private politics: corporate disclosure of climate change strategies

The challenges associated with climate change will require governments, citizens, and firms to work collaboratively to reduce greenhouse gas emissions, a task that requires information on companies' carbon risks, opportunities, strategies, and emission levels. This paper explores the conditions under which firms participate in this endeavor. Building on theories of how social activists inspire changes in organizational norms, beliefs, and practices, we hypothesize that shareholder actions and regulatory threats are likely to prime firms to adopt practices consistent with the aims of a broader social movement. We find empirical evidence of direct and spillover effects. In the domain of private politics, shareholder resolutions filed against a firm and others in its industry increase a firm's propensity to engage in practices consistent with the aims of the related social movement. Similarly, in the realm of public politics, threats of state regulations targeted at a firm's industry as well as regulations targeted at other industries increase the likelihood that the firm will engage in such practices. These findings extend existing theory by showing that both activist groups and government actors can spur changes in organizational practices, and that challenges mounted against a single firm or a single industry can inspire both firm and field‐level changes. Copyright © 2009 John Wiley & Sons, Ltd.     

刍议跨国并购交易中的几个关注因素

在全球经历了五次并购浪潮后,越来越多的中国公司希望通过跨国并购的形式寻求海外投资机会,实现跨越式发展。有鉴于此．中华咨询与美国波士顿商学院联合进行了跨国并购领域的专项研究,     

The role of economic and normative signals in international prosocial crowdfunding: An illustration using market orientation and psychological capital

Entrepreneurs in emerging nations are increasingly seeking microloans on international crowdfunding platforms composed of prosocial lenders primarily seeking non-monetary returns. Drawing on signaling theory, we posit that economic signals (as illustrated by market orientation) and normative signals (as illustrated by psychological capital) embedded within borrower narratives will influence funding time. A Computer-Assisted-Text-Analysis (CATA) of 130,964 profiles across 49 countries suggests that borrower cues of customer orientation, competitor orientation, long-term focus, profitability focus, confidence, and optimism are positively associated funding time, while cues of coordination, hope, and resilience are negatively associated with funding time. Prosocial lenders seem less inclined to lend to borrowers that exhibit a desire for economic success or normative expectations for positive outcomes in the future, while they seem to lend more rapidly to those exhibiting current hardship or a concern for people. A discussion of these findings and their implications for poverty alleviation concludes the study.     

Style consumption: its drivers and role in sustainable apparel consumption

This study proposes style consumption (SC) as a way to foster sustainable apparel consumption. In doing so, we identify explanatory and outcome variables of SC and also examine gender differences in these variables. Based on an online survey with 586 consumers, we find that frugal apparel consumption (FAC), fashion consciousness (FC) and ecologically conscious consumption (ECC) enhance the likelihood of SC. SC in turn increases environmental apparel purchase (EAP) and sustainable apparel divestment (SAD). The results also suggest significant gender differences both in motivational and behavioural variables included in the model. Specifically, females are significantly higher than males in FAC, FC and ECC. The tendency of SC, EAP and SAD were also higher for females than males. In addition, we find that gender is a significant factor mediating the effect of FC and that of ECC on SC.     

The growing popularity of spiritual brands: What drives purchase intent?

In this study, we investigate the reason for the growing popularity of FMCG (Fast Moving Consumer Goods) household products branded, promoted and sold in India by local spiritual leaders. We find that religiosity and normative community pressure are important purchase drivers for such products. Surprisingly, pragmatism in the presence of normative pressure also contributes to demand. We argue that self-identity theory provides a contextualized explanation in association with social identity theory to explain the influence of normative pressure on increased demand. The results of the study suggest that integrating social and self-identity theories provides a fuller insight into consumer behaviour in a complex social context.