Ritu Lohtia

What constitutes a transaction-specific asset? : An examination of the dimensions and types

Abstract Transaction-cost economics has been applied to a wide range of research areas; however, the definition of transaction-specific asset (TSA) has been overlooked. Content analysis of previous research suggests six dimensions (specificity, magnitude, durability, value-in-use, importance, and risk) and six types (site, human, physical, dedicated, brand name, and temporal assets) of TSAs. Prior empirical operationalizations of TSAs are also content-analyzed, and results indicate that although all six types of TSAs have received research attention, only three dimensions have been empirically addressed. Correspondence analysis is used to examine the relationships among the types and dimensions of TSAs.

Export channel design: The use of foreign distributors and agents

Because many manufacturers are unable to integrate vertically into global distribution, the nonintegrated market entry modes of foreign distributor and agent are frequently used. Unfortunately, little is known about choosing efficiently between distributor and agent because research has only partially examined the importance of transaction and production costs in determining institutional arrangements. To specify efficient channel design, this article develops and tests hypotheses linking the characteristics of export exchange to the cost-minimizing mode of export channel governance. Based on a sample of 269 manufacturers, results suggest that market diversity, type of transaction-specific asset, and production cost economies all affect the choice between foreign-based agents and distributors. The article concludes with the implications of these results for export management and future export research.

Improving trade show effectiveness by analyzing attendees

Abstract Trade shows are chaotic selling environments. Many firms are disappointed with their sales results from shows. In this article, selling at shows is shown to be more effective when it is based on an analysis of the job roles of attendees. While show audiences comprise people filling many roles, salespeople are more productive when they target individuals who participate in buying centers at trade shows. Using data collected from a large industrial equipment show, this research demonstrates the importance for show selling of analyzing the number and composition of job roles in the attendance parties of buying firms. Suggestions are provided to help exhibiting firms improve selling by better adapting their sales resources to the needs of different job roles that comprise the at-show buying center.

Effects of source and paper color on response rates in mail surveys

Abstract The purpose of this research is to study the effect of four sponsors (honor society, university, marketing research firm, and an unidentified sponsor) on the response rates to a questionnaire sent to a commercial population. In addition, the main and interaction effects of color of stationery (pink, green, yellow, and white) are examined. This research expands on the previous use of limited types of questionnaire source by including the first use of two source types, an academic honor society and an unidentified sponsor. Also, this research for the first time studies the interaction of types of questionnaire source and paper color on survey response rates. The authors conclude that mean response rates for a university or academic honor society are significantly higher than those for a marketing research firm or an unidentified sponsor. However, they found no significant impact on response rates by the use of different colors of stationery and also found no source and color interaction effects.

The Impact of Transaction‐specific Investments on Buyer‐Seller Relationships

Many business‐to‐business buyers are building closer relationships with fewer sellers. When faced with the choice of which sellers to partner with, buyers often develop such close relationships with sellers who have made transaction‐specific investments (TSIs). TSIs are assets (both tangible and intangible) that have very little value outside a particular relationship. Sellers thinking of making these TSIs need to be able to assess the buyer′s probable response to such investments to help determine whether such investments would be advisable for the seller. Develops and tests a model of buyer‐seller relationships to assess the impact of a TSI on buyer′s perceptions of the benefits to the seller′s TSI. Using previous literature and managerial evidence, the model hypothesizes two paths within the TSI Benefits Model which represent the benefits that the buyer perceives to be outcomes of the TSI. Identifying the one benefit path that the buyer values more will allow the seller to stress those corresponding be...

Collaborative Relationships for Component Development: The Role of Strategic Issues, Production Costs, and Transaction Costs

Abstract Original equipment manufacturers (OEMs) increasingly rely on specialist vendors to develop the highly complex component parts needed for today’s sophisticated industrial end products. However, rather than working closely together on the component development tasks, the OEM and vendor often perform their respective development activities autonomously. This article examines the role played by strategic and cost factors in determining whether component development is conducted as an arm’s-length arrangement or as a highly collaborative partnership. An empirical test of 207 OEM–vendor relationships indicates the primacy of production and transaction costs in accounting for the shift to collaborative development of new industrial components. The article concludes by drawing implications for researchers as well as for managers responsible for developing components with an outside partner.

Hybrid governance: the role of transaction costs, production costs and strategic considerations

Practitioners often are confused by theories that offer ambiguous prescriptions for designing the institutional forms or governance structures in which business activities are conducted. Unclear prescriptions for organizing tasks within the main governance alternatives leave key design decisions unguided: which tasks to perform in‐house (hierarchy), which to contract to outside agencies (market), and which to perform jointly by economic units within and outside the firm (hybrid)? A popular current theory ‐ transaction cost analysis ‐ suggests that governance structures should be aligned to tasks in a “mainly transaction cost economizing way.” Argues that the importance of transaction costs is overstated, and that observed patterns of firms’ governance structures suggest that firms also account for other theoretical issues ‐ production costs and strategic considerations ‐ in determining efficient boundaries. Begins by illustrating that transaction costs are not always primary. Then discusses the factors that impact production costs and transaction costs, and reviews certain strategic considerations that impact the choice of governance structure for a task. Offers practitioners guidance in choosing governance structures through a contingency analysis that examines the interaction of production costs, transaction costs, and strategic considerations. Illustrates normative implications for designing governance structures through corporate examples that are driven by both cost and strategy considerations.

Salesperson Evaluation Using Relative Performance Efficiency: The Application of Data Envelopment Analysis

A recurring, but unresolved, issue in salesforce research is the choice of salesperson performance evaluation methodology. Salesforce compensation is typically based on some form of evaluation, and hence the assessment method used is critical. The authors outline several evaluation methods currently in use and their pros and cons. Some methods are purely output or purely input based, and often employ only one indicator of performance. Still other methods use absolute ratios of outputs to inputs, or compare performance with the “average” performance rather than the “best.” The authors propose a data envelopment analysis (DEA) based approach that provides a measure of relative (to best) performance efficiency. An empirical example illustrates the proposed method of salesperson evaluation. The advantages of the proposed approach are discussed along with a description of situations in which its use may be more appropriate.

Emotional Appeal and Incentive Offering in Banner Advertisements

ABSTRACT This study proposes a contingency framework on the role of emotions and incentives in affecting banner ads effectiveness. More specifically, how emotional appeals affect banner ad click-through rates in the presence or absence of incentives is explored. Data collected from nearly ten thousand real world banner ads is used to empirically test the moderating effect of ad-induced emotional appeals on the relationship between incentive offerings and banner ad effectiveness. The analysis concludes that providing incentives in banner ads is effective in soliciting click-through. When combined with emotional appeals, we found that positive emotions in banner ads enhance the effectiveness of incentives. However, ads with negative or no emotions seem to work better only when no incentives are offered.

Efficient consumer response in Japan: Industry concerns, current status, benefits, and barriers to implementation

Abstract Efficient consumer response (ECR) involves reengineering, redesigning, and computerizing of the supply chain and aims to provide greater value to the consumer. This article examines the current status of ECR in Japan. Data collected from Japanese manufacturers, wholesalers, and retailers are used to examine the current competitive environment facing channel members and the perceived benefits and barriers to implementing ECR. The reasons for not implementing ECR are also explored. The results of this survey show that the Japanese business environment is ripe for large-scale ECR implementation. More than 20% of the companies in the sample are in a stage beyond mere planning. This reflects the extent to which these companies believe that ECR is beneficial. In addition to the general benefits of ECR, Japanese channel members also valued the specific benefits related to efficient replenishment. Regarding their perceptions of the barriers to ECR adoption, those companies that had already implemented ECR and those that had not differed significantly. Financial barriers were big factors for those who had not implemented ECR. For those companies that had implemented ECR, lack of both skill and technology related capabilities and the attitudes of channel members were the main barriers to implementation.