Susan M. Mudambi

What makes a helpful online review? a study of customer reviews on amazon.com

Customer reviews are increasingly available online for a wide range of products and services. They supplement other information provided by electronic storefronts such as product descriptions, reviews from experts, and personalized advice generated by automated recommendation systems. While researchers have demonstrated the benefits of the presence of customer reviews to an online retailer, a largely uninvestigated issue is what makes customer reviews helpful to a consumer in the process of making a purchase decision. Drawing on the paradigm of search and experience goods from information economics, we develop and test a model of customer review helpfulness. An analysis of 1,587 reviews from Amazon.com across six products indicated that review extremity, review depth, and product type affect the perceived helpfulness of the review. Product type moderates the effect of review extremity on the helpfulness of the review. For experience goods, reviews with extreme ratings are less helpful than reviews with moderate ratings. For both product types, review depth has a positive effect on the helpfulness of the review, but the product type moderates the effect of review depth on the helpfulness of the review. Review depth has a greater positive effect on the helpfulness of the review for search goods than for experience goods. We discuss the implications of our findings for both theory and practice.

Branding Importance in Business-to-Business Markets: Three Buyer Clusters

With the growth of e-commerce and global competition, business-to-business (B2B) marketers are showing increased interest in the potential of branding, especially at the corporate level. This paper describes branding in the context of B2B markets, and examines its perceived importance to buyers. A review of relevant literature and the development of a conceptual model enables a cluster analysis of data from a survey of industrial buyers. The exploratory analysis examines to whom branding is important, and in what situations. Three clusters of buyers are found: branding receptive, highly tangible, and low interest. The practical implications for managers are explored.

An exploration of branding in industrial markets

Is branding important in industrial markets? To answer this question, the authors synthesize previous research in branding and related areas to develop a new conceptual model of industrial brand value to the customer. Expected brand value consists of four components: product performance, distribution (ordering and delivery) performance, support services performance, and company performance, with each component integrating both tangible and intangible elements. This model is then compared to the views elicited from in-depth interviews with manufacturers, distributors, and purchasers of precision bearings. This exploratory study of the decision-making process and the sources of industrial brand value highlights the importance of relatively intangible product and company attributes. The findings indicate that branding may play a powerful role, especially in industrial markets where it is increasingly difficult to maintain meaningful differentiation on the basis of product quality or price.

Make, Buy or Ally? Theoretical Perspectives on Knowledge Process Outsourcing Through Alliances

Outsourcing knowledge and innovation activities offer cost savings and superior performance, but can also put a firms unique resources and capabilities at risk. Characterizations of outsourcing as a make-or-buy decision do not fit well with decisions on knowledge process outsourcing (KPO). KPO is a make-or-ally decision, as firms seek a governance structure that will both protect and leverage their strategic knowledge assets, with the final decision often coming down to a choice between different alliance forms. Our new conceptualization provides an integrated perspective on resource integration and transaction specificity in the knowledge governance decision. The model illustrates the dynamics and learning involved in knowledge outsourcing by identifying two distinct paths to KPO alliances.

Diversification and market entry choices in the context of foreign direct investment

Multinational enterprises (MNEs) consider many factors when making decisions in the context of foreign direct investment (FDI). The MNE must decide whether to diversify or to concentrate on its main line of business (LOB). It must also decide whether to enter into a foreign market through a greenfield or acquisition strategy. This paper analyzes both decisions. The international business literature has generally treated these strategic choices as independent. This paper introduces a more realistic selection model, in which the diversification choice and the entry mode choice are made sequentially, and are therefore related. The model is tested using a data set of FDI into the United Kingdom by MNEs in engineering and related industries. The analysis indicates a strong relationship between the diversification choice and the entry mode decision. In virtually all cases, the statistical significance of the selection model is higher than that of the independent model, indicating an improvement over previous research. Overall, the results indicate that the decisions on product diversification and foreign mode of entry are related. Diversified firms are more likely to enter through acquisition. Firms focusing on their main LOB are more likely to enter through greenfield entry. The paper also identifies a number of managerially relevant factors affecting these relationships.

Satisfaction in technology‐enabled service encounters

Purpose – This paper aims to determine the importance of the human touch in customer service interactions.Design/methodology/approach – The paper is based on two original studies using tech‐savvy respondents, utilizing a survey and scenario‐based research.Findings – The paper finds that, even for tech‐savvy customers, human touch is an important factor in both customer satisfaction and behavioral intentions.Research limitations/implications – The study is limited to US respondents and telephone‐based service encounters.Practical implications – This paper shows the importance of keeping some aspects of the human touch in customer encounters with the firm. Firms cannot rely on self‐service technology for all services.Originality/value – This paper fulfills a gap in the existing services literature, with a specific focus on valuing human interaction in technology‐enabled service encounters.

Assessing the readiness of firms for CRM: a literature review and research model

The concept of customer relationship management (CRM) resonates with managers in todays competitive economy. Yet recent articles in the business press have described CRM implementation failures, and consequent company reluctance to invest in CRM. The potential for substantially improved customer relationship management, coupled with the high uncertainty surrounding failed implementation efforts, calls for a critical new look at the determinants of, and influences upon, a firms decision to adopt CRM. This paper responds by underscoring the criticality of performing a deep analysis of a firms readiness to undertake a CRM initiative. We suggest that this assessment provide detailed answers to two fundamental questions: What is a firms current CRM capability? And what changes must be in place before embarking on a CRM initiative? A model to assess readiness is developed based upon the premise that business value is enhanced through the alignment of complementary factors occurring along three dimensions, intellectual, social, and technological.

INDUSTRIAL DISTRIBUTORS: CAN THEY SURVIVE IN THE NEW ECONOMY

Abstract As e-commerce evolves and gains power in the business-to-business (B2B) marketplace, what lies ahead for the industrial distributor? The fundamental issue from the distributors point of view is how to compete more effectively and profitably, given the changing business environment of the new economy. This paper reviews the literature on the distributors role and relationships and introduces a conceptual model of distributor viability. The model identifies sources of value that distributors offer to manufacturers and customers, including customer relationship management (CRM), production and operations management (POM), and knowledge management (KM). The paper explores the managerial implications of distributor relationships and sources of value. This provides the foundation for better understanding of the viability of industrial distributors in the new economy.

Multinational Enterprise Knowledge Flows: The Effect of Government Inward Investment Policy

Governments around the world compete with each other to attract foreign direct investment from multinational enterprises (MNEs), using a variety of incentives and supports. Policy makers generally have two objectives for MNE investment that may be summarized under the headings of employment generation and knowledge creation. However, past research has provided little empirical evidence regarding which policies have the most effect on employment and knowledge flows. Using patent data on foreign-owned firms in the UK, we analyze the effect of inward investment policies on knowledge flows into the local environment, and also estimate the effects of these policies on the headcount employment. Key Results At the aggregate level, investment supports appeared to have limited impact. However, an examination of the individual policy components revealed strong effects. Tax abatement and firm-specific infrastructure supports were associated with greater knowledge flows, while training grants and incentives for backward areas were associated with greater employment generation. No single policy incentive was able to generate both knowledge flows and jobs. A striking finding is that incentives for locating in backward areas had a negative effect on knowledge generation, indicating that the MNEs that were attracted by these incentives only located low-tech activities in such resource poor areas. Authors Ram Mudambi, Associate Professor of Strategy and International Business, Fox School of Business and Management, Temple University, Philadelphia PA 19122, USA; Reader in International Business, ISMA Centre, University of Reading, RG6 6BA, UK. Email: ram.mudambi@temple.edu Susan Mudambi, Assistant Professor of Marketing, Fox School of Business and Management, Temple University, Philadelphia PA 19122, USA. Email: susan.mudambi@temple.edu Abbreviated Heading: Multinational Enterprise Knowledge Flows

A Topology of Strategic Choice in Retailing

Retailers face a multitude of strategic choices, with varying levels of risk, profitability and societal impact. Sifting through these options is a daunting task. In the literature, strategies have been successfully categorized using grids and matrices. Reviews first the strategy matrix approach, especially as applied to retailing; then introduces a topology of strategic choice in retailing which provides a way to assist retailers to think and manage strategically. The topology configures strategies into four directions: internal, horizontal, vertical and migrational. Internal strategies reside at the intraorganizational level and encompass various differentiation and time strategies. Horizontal strategies are expansionary and include choices on outlet numbers, internationalization, mergers and joint ventures. Vertical strategies turn the firm towards its suppliers and include supplier acquisition and improved buyer‐supplier relations. Migrational strategies are extraterritorial and involve radical change...