Extending the BG/NBD: A simple model of purchases and complaints

Extant customer-base models like the beta geometric/negative binomial distribution (BG/NBD) predict future purchasing based on customers' observed purchase history. We extend the BG/NBD by adding an important non-transactional element that also drives future purchases: complaint history. Our model retains several desirable properties of the BG/NBD: it can be implemented in readily available software, and estimation requires only customer-specific statistics, rather than detailed transaction-sequence data. The likelihood function is closed-form, and managerially relevant metrics are obtained by drawing from beta and gamma densities and transforming these draws to a sample average. Based on more than two years of individual-level data from a major U.S. internet and catalog retailer, our model with complaints outperforms both the original BG/NBD and a modified version. Even though complaints are rare and non-transactional events, they lead to different substantive insights about customer purchasing and drop-out: customers purchase faster but also drop out much faster. Furthermore, there is more heterogeneity in drop-out rates following a purchase than a complaint.     

The impact of the introduction and use of an informational website on offline customer buying behavior

Do customers increase or decrease their spending in response to the introduction of an informational website? To answer this question, this study considers the effects of the introduction and use of an informational website by a large national retailer on offline customer buying behavior. More specifically, we study a website's effects on the number of shopping trips and the amount spent per category per shopping trip. The model is calibrated through the estimation of a Poisson model (shopping trips) and a type-II tobit model (the amount spent per category per shopping trip), with effect parameters that vary across customers. For the focal retailer, an informational website creates more bad than good news; most website visitors engage in fewer shopping trips and spend less in all product categories. The authors also compare the characteristics of shoppers who exhibit negative website effects with those few shoppers who show positive effects and thus derive key implications for research and practice.     

Investigating the immediate and long-term effects of job stressors on frontline service employees

Two studies investigate the immediate and long-term effects of job stressors on frontline service employees (FSEs). Using cognitive appraisal theory, we develop and test a conceptual model of two job stressors (crowding and emotional labor) that affect coping strategies and job outcomes. Study 1, which is a field experiment, investigates the immediate effects of crowding in a single firm. Study 2 extends the findings of Study 1 and investigates the long-term effects of emotional labor and crowding on FSEs across multiple firms. The results show that crowding has a negative impact on coping strategies and job-related outcomes. In addition, emotional labor can lead to long-term negative outcomes, such as emotional exhaustion and decreased job retention, for some FSEs. Consequently, service organizations should consider strategies or tactics that prevent high levels of customer crowding and help FSEs deal with emotional labor.     

Deonance and Distrust: Motivated Third Party Information Seeking Following Disclosure of an Agent’s Unethical Behavior

This article explores the hypothesis that third parties are motivated to seek information about agents who have behaved unethically in the past, even if the agent and available information are irrelevant to the third parties’ goals and interests. We explored two possible motives for this information seeking behavior: deonance, or the motive to care about ethics and justice simply for the sake of ethics and justice, and distrust-based threat monitoring. Participants in a consumer decision task were found to seek out information about an agent who had behaved unethically even when the agent was explicitly excluded from the task; there were no intentions to purchase from the agent; performance expectations for the agent’s product were low; the information that could be sought was non-diagnostic, redundant or irrelevant to an ethical judgment; and alternatives in the market offered as good or better value as the unethical agent. Critically, this information seeking took place even when the observer could disengage from and was not vulnerable to the agent. The findings are discussed in terms of third party information seeking and its effects on ethical behavior in the marketplace.     

Business strategy, marketing organization culture, and performance

Drawing on configuration theory, we develop and test a model which posits that overall firm performance will be influenced by how well the marketing organization??s cultural orientation (i.e., market, adhocracy, hierarchy, or clan) complements alternative business strategies (i.e., Prospector, Analyzer, Low-Cost Defender, Differentiated Defender) after controlling for other, key firm-level variables. Responses from a sample of senior marketing managers provide partial support for the model and demonstrate that high-performing businesses of one strategy type have a different cultural orientation than high-performing businesses of the other strategy types. And, contrary to previous research, the results of this study show that each of the cultural orientations may play a role in creating superior performance. We conclude with a discussion of the implications for scholars and for managers.     

Candidate gene studies and the quest for the entrepreneurial gene

Candidate gene studies of human behavior are gaining interest in economics and entrepreneurship research. Performing and interpreting these studies is not straightforward because the selection of candidates influences the interpretation of the results. As an example, Nicolaou et al. (Small Bus Econ 36:151?C155, 2011) report a significant association between a common genetic variant in the DRD3 gene and the tendency to be an entrepreneur. We fail to replicate this finding using a much larger, independent dataset. In addition, we discuss the candidate gene approach and give suggestions to avoid the publication of false positives.     

Accommodating spatial correlation across choice alternatives in discrete choice models: an application to modeling residential location choice behavior

This paper presents a modeling methodology capable of accounting for spatial correlation across choice alternatives in discrete choice modeling applications. Many location choice (e.g., residential location, workplace location, destination location) modeling contexts involve choice sets where alternatives are spatially correlated with one another due to unobserved factors. In the presence of such spatial correlation, traditional discrete choice modeling methods that are often based on the assumption of independence among choice alternatives are not appropriate. In this paper, a Generalized Spatially Correlated Logit (GSCL) model that allows one to represent the degree of spatial correlation as a function of a multi-dimensional vector of attributes characterizing each pair of location choice alternatives is formulated and presented. The formulation of the GSCL model allows one to accommodate alternative correlation mechanisms rather than pre-imposing restrictive correlation assumptions on the location choice alternatives. The model is applied to the analysis of residential location choice behavior using a sample of households drawn from the 2000 San Francisco Bay Area Travel Survey (BATS) data set. Model estimation results obtained from the GSCL are compared against those obtained using the standard multinomial logit (MNL) model and the spatially correlated logit (SCL) model where only correlations across neighboring (or adjacent) alternatives are accommodated. Model findings suggest that there is significant spatial correlation across alternatives that do not share a common boundary, and that the GSCL offers the ability to more accurately capture spatial location choice behavior.     

Market-focused sustainability: market orientation plus!

The concept of sustainability is increasingly being addressed theoretically by scholars and practically by managers and policymakers. With this growing focus on sustainability efforts, marketing is in a unique position to elevate its focus from managing relationships with customers to strategically managing a broader set of marketplace issues. Overall, an organization achieves market-based sustainability to the extent that it strategically aligns itself with the market-oriented product needs and wants of customers and the interests of multiple stakeholders concerned about social responsibility issues involving economic, environmental, and social dimensions. To set the stage for marketing’s inquiry into sustainability efforts, I briefly review the concept of sustainability, compare it with corporate social responsibility, bring in stakeholders, argue for the notion of “market orientation plus,” and consider the possibility that the notion of what sustainability encompasses is converging in the marketing literature.     

Are Asian Sovereign Wealth Funds Different?

Sovereign wealth funds have become a prominent feature of the international financial landscape. However, legitimate concerns have been raised about these funds. Many of those concerns can be addressed via increased accountability and transparency by the funds. The Santiago Principles are a good start in doing so. My sovereign wealth funds scoreboard points to areas where these Principles can be improved. At the same time, the OECD effort to address concerns from the host‐country side has not resulted in the erection of new barriers to that form of cross‐border investment, but the OECD failed to reverse the creeping financial protectionism of the past decade. Because of their size and the source of their funding, some Asian funds stand out. As a result, those funds will be held to a higher standard of accountability and transparency.