Manohar U. Kalwani

On the Reliability and Predictive Validity of Purchase Intention Measures

This paper reports some further analyses and applications of Morrisons model of the predictive relationship between measures of intentions and subsequent purchasing behavior. A review of published studies bearing on the threats to predictive validity of intention scales represented in Morrisons model is presented. Findings from a test-retest study of intention ratings for concept stimuli are shown to be consistent with the levels of reliability expected under the models assumptions of beta binomial distributed scores. Evidence of the predictive validity of intention measures is found in a re-analysis of several sets of relevant data but a different form of predictive relationship is shown to hold for generic durable goods as compared to branded packaged goods. Whereas a linear relationship is supported in the case of durable goods, the presence of a threshold phenomenon in the branded packaged goods data suggests the use of a piecewise linear model. There is reason to believe that the nature and sources of systematic error present in intentions ratings are different for these two types of purchases.

The Role of Bonus Pay in Salesforce Compensation Plans

Abstract Recent data suggest growing use of bonus payments in salesforce compensation plans to improve sales productivity and to achieve a variety of organizational objectives. We report findings from two cross-sectional field studies—a firm-level survey and a salesperson-level survey—on how bonus payments help attain selected firm objectives and their usefulness in eliciting higher salesperson performance and reducing salesforce turnover. Our findings reveal that bonuses may be effective in inducing higher sales productivity because of their flexibility in tying rewards to performance. Further, they may be effective in directing salespeople’s efforts toward specific organizational objectives such as promoting new product sales or sales to new customer groups, and enhancing customer satisfaction and retention.

Do Bonus Payments Help Enhance Salesforce Retention

Our primary aim in this research is to examine if the existence of a bonus component in the sales compensation structure can enhance salesforce retention. We also study the impact of total sales compensation, relative to industry norms, on salesforce retention. We find that bonus payments do enhance salesforce retention among firms whose total compensation is above industry average but not among firms whose total compensation is below industry average. Further, we also examine the role of sales training, non-financial motivational tools, and length of the selling cycle on salesforce retention.

Survival determinants for online retailers

Survival determinants can influence important strategic decisions. Analysis of longitudinal data on 418 online retailers in fourteen Bizrate product categories yields insights into key survival determinants. Survival tends to be easier for introductory versus growth stage entrants. Survival, however, is more difficult for e-tailers who sell touch and feel products and for pure e-tailers who do not have the support of either brick and mortar stores or catalog operations. While introductory stage entrants have higher survival rates versus growth stage entrants, there is no significant impact for rank order of entry or pioneer leadtime. These mixed results point to modest early mover advantages in online retailing. While some e-tailers like Amazon.com benefited from moving early, many others suffered from pioneer burnout.

Culturally Contingent Electronic Word-of-Mouth Signaling and Screening: A Comparative Study of Product Reviews in the United States and Japan

Electronic word of mouth (eWOM) is an important source of influence on consumer decision making, yet little is known about cross-cultural differences in both the occurrence of eWOM and the relationship between eWOM and sales. The authors draw on signaling theory to develop a conceptual model and assess the relationships between country and the occurrence of eWOM, as well as between online ratings and relative product sales according to country. Online reviews and sales rank data for books, CDs, and DVDs were collected from Amazon U.S. and Amazon Japan in 2009 and 2017. Results suggest cross-national differences in both the occurrence of eWOM (eWOM signaling) and the relationship between eWOM and relative product sales (eWOM screening). These national differences appear to change over time: some remain stable, some disappear, and others emerge. The proposed culturally contingent signaling and screening model may be adopted as a framework for future research on cross-cultural eWOM. The results also inform the literature on cultural change by suggesting that cultural differences in eWOM change in nuanced patterns over time.