Determinants of Benefits in the Retail Payments Market: Evidence from Russian Consumers

Abstract

This study identifies the determinants of consumer benefits values in the retail payments market. Using a mix of quantitative (nation-wide representative survey of 1500 individuals) and qualitative inputs (8 focus groups and 32 in-depth interviews), this study finds robust evidence which supports the importance of internal and external user characteristics for the benefits value explanation. Other factors exhibit partial or no correlation with benefits values. Total welfare is efficiently distributed across the market. Findings imply new factors affecting consumer behavior in the retail payments market and suggest a basis for the reassessment of marketing and regulatory strategies.     

Stock market anomalies and baseball cards

Baseball cards exhibit anomalies that are analogous to those that are documented in financial markets, namely, momentum, price drift in the direction of past fundamental performance, and initial public offering (IPO) underperformance. Momentum is higher among active players than retired players, and among newer sets than older sets. Regarding IPO underperformance, we find that newly issued rookie cards underperform newly issued cards of veteran players, and that newly issued sets underperform older sets. The results are broadly consistent with models of slow information diffusion and short-selling constraints.     

Bonus gift card programs: a methodology to measure the impact on revenue and profit

Many retailers are now offering bonus gift cards to entice customers to buy more regular gift cards. The most common offers are a $5 bonus card with $25 worth of gift card purchases or a $10 bonus card with $50 worth of purchases. Unlike regular gift cards, bonus gift cards are not paid for by other customers. Bonus cards provide $5 or $10 of free credit to a customer at the firm’s expense. Most retailers do not understand the potential for cannibalization of revenue and profit when gift card redeemers use a bonus card for a purchase they would have made without it. Nor do they know what proportion of redeemers represent these cannibalized sales versus the proportion of redeemers that represent incremental purchases. We use an in-market study with a large national restaurant chain to demonstrate a methodology and model to properly evaluate the effect of bonus gift card programs on revenue and profit. We found that although bonus gift cards provide incremental revenue, they can significantly reduce profit particularly in certain retail segments. For those who wish to implement a bonus card program, we provide suggestions to maximize the potential for success.     

The Magic of the Personal Touch: Field Experimental Evidence on Money and Appreciation as Gifts*

In this paper, we use two field experiments in professional settings to explore the effort levels of individuals in response to gifts. We extend the literature by looking at non‐financial gifts that signal worker appreciation and gifts that combine financial and non‐financial elements with or without a personal touch. We find that while money and appreciation are individually effective, these only work well together when they are combined with a personal touch. This suggests that responses to gifts are sensitive to the presentation of the gift as well as to interpersonal elements; these are factors that have so far been largely ignored in the literature but are easy to incorporate into existing principal–agent models.     

Gift Giving: An Exploratory Behavioural Study

The purpose of this research is to contribute to the marketing literature through an exploratory review of gift giving behaviour as it pertains to cultural and other demographical variables. Following Mathur's (1996, Psychology & Marketing, 13(1), 107–123) recommendation that future research into gift giving might examine differences among different subgroups in the population, this study closely examined gender differences to identify variables that matter most for female and male gift givers/receivers. Results indicate that 80.7% of respondents had bought a gift within the previous 6 months, mostly for personal reasons (95.4%), which included occasions such as birthdays (64.9%), anniversaries (11.2%), achievement celebrations (10.3%), Father's/Mother's Day (5.0%) and Christmas (1.7%). About 50% of respondents spent between A$10 and A$30 per gift purchase. The results are discussed. Following a comprehensive review of the available literature, the authors set out to formulate a research instrument that would explore respondents' gift giving-related behaviour in terms of the occasion for gift exchange, the relationship between giver and receiver and the range of values that may come into play when engaging in gift giving transactions. Three hundred questionnaires from students at a major Western Australian university were the bases of this report. Of these, 80% reported purchasing a gift in the past 6 months mainly for a family member as a birthday gift, spending A$44 on average. The results revealed that women have a higher perception of gift giving as a valuable opportunity to state relational bonds compared with men. The results also suggested that individuals find it easier to purchase a gift for someone of their same gender, as opposed to someone of the opposite sex. Overall, students from Asia seemed to have a statistically significant difference from Australians and those born elsewhere with respect to their perception of a gift's cost-value, the reciprocity principle and re-gifting practices. This research focused on individuals who frequented a major Western Australian university, thus influencing the age range of the respondents. Future research is encouraged in order to incorporate a greater number of responses and variability in the sample that could allow for an analysis of individuals' opinions about gift giving activities as they relate to their generation. The findings suggest the need to give greater attention to cohort analysis of gift giving behaviour. Matters such as the nature of the relationship between the giver and the recipient, the occasion and the recipient's gender were of primary importance when selecting a gift. This finding may assist marketers' targeting efforts by clarifying what factors consumers tend to consider when purchasing a present. Gender implications also revealed the need to assist individuals in identifying what constitutes an “ideal” gift for a woman or a man. Finally, those residing in Australia tended to find it more difficult to purchase gifts for women than those who reside in Asian countries. This suggests the need to explore acculturation and culture shock notions when it comes to gift giving behaviour. This research incorporated in an exploratory nature those aspects that seemed of greater interest for academics and practitioners, such as gift giving occasion, behaviour, values, and demographical variables such as country of birth and country of residence.     

Encouraging Charitable Donations via Charity Gift Cards: A Self-Determination Theoretical Account

Charities seeking to increase donations are now offering charity gift cards (CGCs), which allow recipients to select how their gift card is allocated across various charitable projects. Supporting a model derived from self-determination theory, an experiment shows that U.S. consumers are more satisfied and more likely to donate to the card-sponsoring charity after using a CGC than after learning a donation has been made in their name, because CGCs enhance consumers’ felt autonomy, competence, and relationship with the charity and its projects, which predict a more charitable self-concept and satisfaction with the gift. Theoretical and managerial implications are discussed.     

Explaining changes in the US credit card market: Lenders are using more information

We examine two changes in the cross-sectional distribution of credit card contracts over time: the increasing variance in interest rates and the increasing variance in credit limits, using data from the 1989–2013 Survey of Consumer Finances. Within this dataset, we show that financial institutions seem to be collecting and using more consumer information when extending credit. We then develop a life-cycle model of lending using a novel contract structure reflecting modern credit cards, where interest rates and credit limits are jointly determined before actual borrowing takes place. Within the model, giving lenders more information on consumers generates realistic results along several dimensions. More information leads to better pricing, moving the market from a ‘pooling’ to a ‘separating’ equilibrium, generating the observed increase in variances, with the gains primarily going to young agents.     

An Updated Look at the Factors Contributing to the Final Selling Price of Auctioned Gift Cards

Much has changed in 10 years, and this study follows up on one previously published that employed linear regression on Home Depot gift cards sold on eBay, which utilized the standard auction format as a proxy for a homogeneous good. The previous study looked at data beginning in 2006 and found results indicating that a number of variables associated with the card influenced the percentage of total value obtained for the card. Gift cards are used much more widely today than previously, and eBay has many more fixed price listings than auctions. It is now much more difficult to see variables related to buyers, leave negative feedback, and accept anything but electronic payment. This article looks at a number of the variables examined in the first study and updates the findings using a dataset of Home Depot cards auctioned over a 2-month time period in 2016.     

Gift cards: a review and research agenda

Gift cards have received limited study despite being a key element of many retailers’ strategies. One reason may be that approaching the study of gift cards from a traditional economic perspective, i.e. ignoring social relationships, leaves little justification for the rapid increase in gift card sales. Failing to see the value of gift cards, many commentators go so far as to argue against the purchase of gift cards, suggesting that consumers would better off using other gift types. This misses the important point that givers voluntarily buy cards and receivers enjoy gaining them. Consumers undoubtedly perceive the value in gift cards. We suggest that taking a broader perspective on consumer behavior and considering consumers involved in social systems that encourage gift giving, allows us to see the value gift cards create while allowing us to address the concerns gift cards raise more effectively. In this article, we detail the benefits created for givers, receivers, and merchants by the use of gift cards. We highlight areas with significant public policy implications. We outline an agenda for some promising areas of research, including seeking to gain a better understanding of the psychology of giving gift cards and the economics of retail strategies dependent upon gift card usage.     

Credit cards in a Chinese cultural context—The young, affluent Chinese as early adopters

This research examines the attitudes of early adopters towards holding and using credit cards, especially how the ‘young and affluent Chinese’ view credit cards, in the Chinese cultural context. The findings indicate that frequent users of credit cards are more inclined to agree that: they display traits of new product adopters; credit cards offer them greater convenience; and others regard them as being more au-fait with technology, and more financially aware. The research also reveals a fear of loss of financial control when using credit cards that may impede its rate of adoption in China.