Charlotte H. Mason

Collinearity, power, and interpretation of multiple regression analysis.

Multiple regression analysis is one of the most widely used statistical procedures for both scholarly and applied marketing research. Yet, correlated predictor variables—and potential collinearity ...

An Empirical Study of Innate Consumer Innovativeness, Personal Characteristics, and New-Product Adoption Behavior

This article explores the relationships between innate consumer innovativeness, personal characteristics, and new-product adoption behavior. To do this, the authors analyze cross-sectional data from a household panel using a structural equation modeling approach. They also test for potential moderating effects using a two-stage least square estimation procedure. They find that the personal characteristics of age and income are stronger predictors of new-product ownership in the consumer electronics category than innate consumer innovativeness as a generalized personality trait. The authors also find that personal characteristics neither influence innate consumer innovativeness nor moderate the relationship between innate consumer innovativeness and new-product adoption behavior.

Defection Detection: Measuring and Understanding the Predictive Accuracy of Customer Churn Models

This article provides a descriptive analysis of how methodological factors contribute to the accuracy of customer churn predictive models. The study is based on a tournament in which both academics and practitioners downloaded data from a publicly available Web site, estimated a model, and made predictions on two validation databases. The results suggest several important findings. First, methods do matter. The differences observed in predictive accuracy across submissions could change the profitability of a churn management campaign by hundreds of thousands of dollars. Second, models have staying power. They suffer very little decrease in performance if they are used to predict churn for a database compiled three months after the calibration data. Third, researchers use a variety of modeling “approaches,” characterized by variables such as estimation technique, variable selection procedure, number of variables included, and time allocated to steps in the model-building process. The authors find important differences in performance among these approaches and discuss implications for both researchers and practitioners.

Visual Representation: Implications for Decision Making

A large number of visualization tools have been created to help decision makers understand increasingly rich databases of product, customer, sales force, and other types of marketing information. This article presents a framework for thinking about how visual representations are likely to affect the decision processes or tasks that marketing managers and consumers commonly face, particularly those that involve the analysis or synthesis of substantial amounts of data. From this framework, the authors derive a set of testable propositions that serve as an agenda for further research. Although visual representations are likely to improve marketing manager efficiency, offer new insights, and increase customer satisfaction and loyalty, they may also bias decisions by focusing attention on a limited set of alternatives, increasing the salience and evaluability of less diagnostic information, and encouraging inaccurate comparisons. Given this, marketing managers are advised to subject insights from visual representations to more formal analysis.

Responses to Information Incongruency in Advertising: The Role of Expectancy, Relevancy, and Humor

Two studies examining the effects of expectancy, relevancy, and humor on attitude formation are presented. Following previous research, expectancy refers to the degree to which an item or a piece of information falls into some predetermined pattern or structure evoked by an ad. Relevancy refers to the degree to which an item or a piece of information contributes to the identification of the primary message communicated by the ad. Across two studies that examined immediate response, we found that information expectancy and relevancy interact to produce different levels of attitude favorability. Although ads with unexpected-relevant information elicited more favorable attitudes than did ads with expected-relevant information, ads with unexpected-irrelevant information yielded less favorable attitudes than did ads with expected-relevant information. Furthermore, humor and relevancy interact where a humorous execution was found to have a favorable effect in ads with unexpected-irrelevant information but not in ads with unexpected-relevant information. In addition, the second study further examined delayed responses in which the findings revealed a different pattern. Particularly noteworthy is a sleeper effect for ads with unexpected-irrelevant information where attitudes for both the ad and the brand improved over time. We conclude with implications and suggestions for future research. Copyright 1999 by the University of Chicago.

Characteristic, Beneficial, and Image Attributes in Consumer Judgments of Similarity and Preference

This article investigates the assumption that similar products are similarly liked. An examination of previous research reveals a subtle discrepancy—what is important to consumers when judging the similarity of products does not necessarily match what is important to them when evaluating products for purchase. In an empirical study, we examine this discrepancy and focus on the role of different kinds of attributes. We find that beneficial attributes were relatively more important in preference assessments than in similarity judgments. Alternatively, characteristic attributes were relatively less important in preference assessments than in similarity judgments. Unexpectedly, image attributes were relatively less important in preference assessment than in similarity judgments. These results provide insights into why “me too” products may not succeed.

An approach for identifying cannibalization within product line extensions and multi-brand strategies

Abstract For decades, a common strategy of firms has been to offer multiple brands and/or brand variants which compete within the same product category. In many categories, dozens or even hundreds of brands are produced by a few dominant firms. Recently, however, manufacturers, retailers, and consumers are increasingly concerned about product proliferation and parity products. Constraints on retail shelf space and manufacturing considerations are examples of pressures leading firms to prune items from their product lines. When reviewing strategy and performance, a critical issue is cannibalization, or the extent to which one products customers are at the expense of other products offered by the same firm. With the exception of new product models, there is little research on cannibalization. In this paper, we propose an approach for identifying cannibalization in mature markets. We empirically illustrate our approach for the cigarette market with 188 brands and brand variants.

Agility in Retail Banking: A Numerical Taxonomy of Strategic Service Groups

This research demonstrates that operations agility--defined as the ability to excel simultaneously on operations capabilities of quality, delivery, flexibility, and cost in a coordinated fashion--is a viable option for retail banks encountering increasing environmental change. The question of whether there is empirical evidence that services, specifically retail banks, display the characteristics of agility like their manufacturing counterparts is open to debate. Conventional wisdom in operations management posits that most successful services trade off one capability for another. Drawing from the resource-based view of the firm, combinative capabilities view, and the cybernetics work of Ashby (1958), theoretical arguments suggest the contrary. The agility paradigm is viable in environments calling for a mix of strategic responses. Applying cluster analytic techniques to a sample of retail banks, using capabilities as taxons, we identify four strategic service groups: agile, traditionalists, niche, and straddlers. Our empirical results provide thematic explanations consistent with theory that account for how the agile strategic group offers a unique configuration of service concept, resource competencies, strategic choices, and business orientation. Profiles of the operations strategies of each strategic service group suggest that each group has found a fit between what certain segments of the market may want and what they have to offer. In particular, we found that the agile group exhibited greater resource competencies than its counterparts, requiring greater investments in infrastructure and technology. Consistent with theory, agile banks performed better over time on an absolute measure of return on assets.

CRM in Sales-Intensive Organizations: A Review and Future Directions

With the advent of technology enabling greater customer tracking, more robust knowledge management, and direct customer communication, the implementation of customer relationship management (CRM) strategies has grown in importance with many implications for sales-intensive organizations. Implications of CRM strategy, analytical CRM, and operational CRM are discussed, particularly in terms of research opportunities. Although there are, no doubt, many other interesting and worthwhile research opportunities available, the nexus of technology, CRM, and sales-intensive go-tomarket strategies provide myriad opportunities for exciting research.

The Link between Attractiveness of “Extrabrand” Attributes and the Adoption of Innovations

While innovators may rush to purchase many new products, most consumers are more conservative and do not want to buy into fads but purchase only those new products that are viable. How do the majority of consumers make judgments about whether they will adopt an innovation? This article examines the evaluative aspects of adoption as a means for better understanding consumer adoption and the market factors that may influence the success of an innovation. This research introduces a conceptual model that shows how consumers’ evaluation of product category attractiveness affects the adoption decision for really new products. These consumer evaluations are based on the attributes of the product category (“extrabrand” attributes) rather than brand attributes. Results from a test of the model indicate that consumers do use extrabrand attributes to assess the attractiveness of innovative new products.