Yoonmo Koo

Media channels and consumer purchasing decisions

Purpose – The purpose of this paper is to explore the factors determining which communication mediums influence a given consumer deciding to purchase a specific product. Design/methodology/approach – Using a consumer survey and a multivariate probit (MVP) model, the authors explore consumer information searches related to purchases in nine categories: milk, instant noodles, shampoo, mobile phones, televisions, cars, mobile communication services, credit card services, and life insurance. Findings – The media channels that motivate a given consumer to make a given purchase vary depending on both socio-demographic variables and product categories. Practical implications – As consumers can now obtain product information through different and multiple media channels according to their personal characteristics and the category of the product they seek to purchase, these findings will help companies develop media planning strategies that will effectively target specific market segments. Originality/value – Unli...

Ex-ante Evaluation of Economic Costs from Power Grid Blackout in South Korea

South Korea is recently under serious situation in supplying electricity with enough power reserve. A single fault of power plant at a peak-load time may lead to a total blackout for whole area connected by a single electric grid and isolated from other grids. Despite of the seriousness of blackout, however, there are scarce studies with ex-ante analysis of the economic costs from blackout. In order to evocate the seriousness, we calculate the economic costs for both industrial and household sectors with using some survey data and statistical methodologies. As a result, total economic costs are 39.23 trillion KRW (35.83 trillion KRW for industrial sector, 3.40 trillion KRW for household sector).

Lowering customer’s switching cost using B2B services for telecommunication companies

Abstract A B2B transaction is a transaction between organizations. However, the ripple effects of a B2B transaction can reach the members of the organization and generate additional economic impact. Enterprise LTE (Long term evolution) is a newly introduced B2B service in the South Korean telecommunications market. While it provides secure and fast telecommunications services to businesses, it can also affect the employees’ utility in the business, since the service provider can provide a variety of additional services to employees who use the same telecommunications provider for their mobile devices. In this study, we empirically analyze how B2B and Enterprise LTE services affect consumer churn-in in the telecommunications market. We estimate consumer benefit based on the additional services provided after the introduction of the B2B service using conjoint analysis. We also estimate consumer switching cost for changing one’s mobile telecommunications service provider using contingent valuation method. By comparing these values, we analyze the switching probability of employees when B2B services are introduced at their workplace. The results show that in order to maximize revenue, considering the revenue gained from new subscribers and from fees for providing additional services, lowering service fees for additional services and maximizing market share are advisable.

The Necessity of a New Industrial Classification Based on Value-Creation Behavior

In the mid-twentieth century, Fisher (1939) and Clark (1940) classified industry into primary, secondary, and tertiary production, which served as the basis of the International Standard Industrial Classification. However, some have criticized Fisher and Clark’s classification as too simple to account for the heterogeneity in tertiary production (i.e., the service industry). By using EU KLEMS and Organisation of Economic Co-operation and Development data, we suggest a new industrial classification based on value-creation behavior that helps explain economic development. In the new paradigm, industry is divided into value-creation sectors composed of base and extended value as well as transferred value industries comprised of production support service, private service, and public service components. The new industrial classification can inform an efficient industrial policy designed to accelerate economic growth.