•This study provides a new understanding of salient consumer risk and benefit beliefs when consumers face new technologies that represent a paradigm shift.•Findings suggest that technology firms need ...to develop new strategic marketing actions constantly.•Increasing an electric vehicle (EV) 's perceived benefits (vendor trustworthiness and expertise) and reducing consumer perceptions of risk is essential.•Beliefs of a manufacturer's expertise and trustworthiness were found to reduce consumer risk concerns.
Consumers who decide to adopt complex, radically innovative products simultaneously can hold very different belief structures that, for example, capture concern for future losses, and beliefs of future gains, as well as the desire to coalesce with referents. This research develops a model of how consumers decide their next electrified vehicle. Based on the Theory of Reasoned Action (TRA) and Risk-Benefit Models, the electric vehicle (EV) purchase decision is modeled as primarily based on beliefs of the perceived benefits and the perceived risks of technology adoption and social influences. Further, beliefs of a manufacturer's expertise and trustworthiness were found to reduce consumer risk concerns and strengthen consumer conviction that the benefits of technology were attainable. Structural equation modeling of survey data confirm the proposed consumer decision model, and our contention that technology adoption can be better understood by specifically exploring discordant consumer beliefs of the post-purchase consequences. The results of our research provide a new understanding of salient consumer risk and benefit beliefs when consumers face new technologies that represent a paradigm shift. Results also provide insight for technology firms that need to constantly develop new strategic marketing actions designed to increase demand for their complex technological products.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NLZOH, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UILJ, UL, UM, UPCLJ, UPUK, ZAGLJ, ZRSKP
A new model of consumer behavior is developed using a hybrid of cognitive psychology and microeconomics. The development of the model starts with the mental coding of combinations of gains and losses ...using the prospect theory value function. Then the evaluation of purchases is modeled using the new concept of "transaction utility." The household budgeting process is also incorporated to complete the characterization of mental accounting. Several implications to marketing, particularly in the area of pricing, are developed.
This article was originally published in Marketing Science , Volume 4, Issue 3, pages 199–214, in 1985.
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Corporate social responsibility (CSR) has emerged as an effective way for firms to create favorable attitudes among consumers. Although prior research has addressed the direct influence of proactive ...and reactive CSR on consumer responses, this research hypothesized that consumers' perceived organizational motives (i.e., attributions) will mediate this relationship. It was also hypothesized that the source of information and location of CSR initiative will affect the motives consumers assign to a firms' engagement in the initiative. Two experiments were conducted to test these hypotheses. The results of Study 1 indicate that the nature of a CSR initiative influences consumer attribution effects and that these attributions act as mediators in helping to explain consumers' responses to CSR. Study 2 suggests that the source of the CSR message moderates the effect of CSR on consumer attributions. The mediating influence of the attributions as well as the importance of information source suggests that proper communication of CSR can be a viable way to inculcate positive corporate associations and purchase intentions.
Despite the extensive use of the term “engagement” in the context of brand communities, the theoretical meaning and foundations underlying this term remain underexplored in the literature to-date. ...Drawing on a literature review, this study adopts netnographic methodology to explore the nature and scope of consumer engagement in an online brand community environment. The study reveals the complex multidimensional and dynamic nature of consumer engagement, which may emerge at different levels of intensity over time, thus reflecting distinct engagement states. Further, the consumer engagement process comprises a range of sub-processes reflecting consumers' interactive experience within online brand communities, and value co-creation among community participants. Engaged consumers exhibit enhanced consumer loyalty, satisfaction, empowerment, connection, emotional bonding, trust and commitment. The paper concludes with a discussion of implications for practice and further research.
► Customer engagement (CE) is an important concept in online brand communities. ► CE has behavioral, cognitive and emotional dimensions. ► CE sub-processes include sharing, co-developing, learning, advocating & socializing. ► CE leads to satisfaction, empowerment, connection, bonding, trust and commitment. ► Engaged customers exhibit enhanced loyalty.
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GEOZS, IJS, IMTLJ, KILJ, KISLJ, NUK, OILJ, PNG, SAZU, SBCE, SBJE, UL, UM, UPCLJ, UPUK
Consumers’ interactions with smart objects have a relational nature, and extensive research has supported the “relationship metaphor” as a fruitful way to understand consumer responses to consumption ...objects. But, smart objects pose unique challenges for considering the emergence of consumer–object relationships, because their degrees of agency, autonomy, and authority lend them their
own
unique capacities for interaction. We present a new framework for consumer–object relationships based on the circumplex model of interpersonal complementarity and situated in assemblage theory and object-oriented ontology. Consumer–object relationship styles are defined in terms of two foundational dimensions of behavior, agency, and communion, based on the expressive roles played by consumer and object. The overlay of assemblage theory provides a conceptually rich understanding of the space of master–servant, partner, and unstable relationship styles, along with their concomitant positive (enabling) versus negative (constraining) consumer experiences. The model’s underlying geometry supports extensive empirical work and provides a powerful managerial framework for measuring and tracking consumer–object relationships and the journeys they take over time.
When a product of uncertain quality is first introduced, consumers may choose to strategically delay their purchasing decisions in anticipation of the product reviews of their peers. This paper ...investigates how the presence of social learning affects the strategic interaction between a dynamic-pricing monopolist and a forward-looking consumer population, within a simple two-period model. Our analysis yields three main insights. First, we find that the presence of social learning has significant structural implications for optimal pricing policies: In the absence of social learning, decreasing price plans are always preferred by the firm; by contrast, in the presence of social learning we find that (i) if the firm commits to a price path ex ante (preannounced pricing), an increasing price plan is typically announced, whereas (ii) if the firm adjusts price dynamically (responsive pricing), prices are initially low and may either rise or decline over time. Second, we establish that under both preannounced and responsive pricing, even though the social learning process exacerbates strategic consumer behavior (i.e., increases strategic purchasing delays), its presence results in an increase in expected firm profit. Third, we illustrate that, contrary to results reported in existing literature on strategic consumer behavior, in settings where social learning is significantly influential, preannounced pricing policies are generally not beneficial for the firm.
This paper was accepted by Yossi Aviv, operations management
.
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This paper studies the potential benefits of responsive pricing and demand learning to sellers of seasonal fashion goods. As typical in such markets, demand uncertainty is high at the beginning of a ...season, but there is a potential opportunity to learn about demand via early sales observations. Additionally, although the consumers have general preference for purchasing a fashion product earlier rather than later in the season, they may exhibit strategic behavior—contemplating the benefits of postponing their purchase in anticipation of end-of-season discounts. Our results demonstrate that the benefits of responsive pricing, in comparison with a benchmark case of a fixed-price policy, depend sharply on the nature of the consumers’ behavior. Interestingly, in stark contrast to markets of myopic consumers, when the consumers are all strategic, the benefits of responsive pricing tend to worsen when there is a higher potential for learning. We explain this counterintuitive outcome by pointing to two phenomena: the spread effect and information shaping. For example, sellers of fashion products that consider upgrading their pricing systems to incorporate “
accurate response
” strategies (i.e., integrating learning and responsive pricing) should be aware of the possibility that such action might lead them to a new and potentially worse equilibrium, particularly when there is a higher opportunity to learn. Despite the fact that price commitment completely eliminates the seller’s ability to learn, it appears to increasingly dominate responsive pricing as the portion of strategic consumers in the market increases. But, although performing better than responsive pricing, a price-commitment policy is typically limited in performing effective discrimination. Finally, we studied the potential benefits of quick response strategies—ones that embed both dynamic pricing and quick inventory replenishment during the sales season—and found that they are particularly significant under strategic consumer behavior. We explain this result by arguing that quick response provides the seller with a real option that serves as an effective implicit threat to the consumers: encouraging them to buy earlier at premium prices rather than wait for discounts at the end of the season.
The online appendix is available at
https://doi.org/10.1287/mnsc.2018.3114
.
This paper was accepted by Martin Lariviere, operations management.
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49.
Best Customers Editors, The New Strategist
2014, 2018
eBook
Find out how the American marketplace has been transformed by the Great Recession in the new 10th edition of Best Customers: Demographics of Consumer Demand, with all-important 2012 spending data. ...Best Customers is a unique look at who the best and biggest customers are for hundreds of individual products and services. The new edition of Best Customers includes analyses of spending trends before (2000 to 2006) and after (2006 to 2012) the Great Recession, product by product.
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