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- 28 Sep 2007
- Working Paper Summaries
Digital Interactivity: Unanticipated Consequences for Markets, Marketing, and Consumers
For digital marketing practice and theory, the last decade has brought two related surprises: the rise of social media and the rise of search media. Marketing has struggled to find its place on these new communication pathways. Old paradigms have been slow to die. This paper reviews early beliefs about interactive marketing, then identifies 5 discrete roles for interactive technology in contemporary life and 5 ways that firms respond. It concludes that the new media are rewarding more participatory, more sincere, and less directive marketing styles than the old broadcast media rewarded. Key concepts include: Successful interactive marketing may be less a matter of domination and control, and more a matter of fitting in. There is a human need to assert and present to the world a self-serving identity and to manage one's personal reputation. The form of interactivity most attractive to marketing is one that facilitates people's ability to construct their identity and contribute to the making of meaning. Closed for comment; 0 Comments.
- 20 Sep 2007
- Research & Ideas
How to be a Customer
Sure, most marketing efforts aim to influence consumer behavior. But consumers can also market themselves to influence vendors, says Professor John Quelch. Want to get a little extra whipped cream from your neighborhood barista? Here are tips to become a valuable customer. Key concepts include: Customers should market themselves to sellers to obtain an advantage over their competition—other customers. Vendors appreciate customers who are demanding, respectful, reliable, surprising, and engaging. Closed for comment; 0 Comments.
- 27 Aug 2007
- Op-Ed
Mattel: Getting a Toy Recall Right
Mattel has been criticized heavily for having to recall not once but twice in as many weeks 20 million toys manufactured in China. But Mattel also deserves praise for stepping up to its responsibilities as the leading brand in the toy industry. Harvard Business School professor John Quelch examines what Mattel did right. Key concepts include: Mattel's recall of 20 million toys made in China was handled deftly: The CEO took personal charge of the problem. Consumers are being empowered by Mattel's communications. The recall Web site is a model of excellence. Mattel's compensation program to customers may not be sufficient. Closed for comment; 0 Comments.
- 18 May 2007
- Working Paper Summaries
An Empirical Approach to Understanding Privacy Valuation
What do consumers value and why? Researchers on privacy remain stumped by a "privacy paradox." Consumers declare that they value privacy highly, yet do not take steps to guard it during transactions. At the same time, consumers feel unable to enact their preferences on privacy. Clearly, scholars need a more nuanced understanding of how consumers treat information privacy in complex situations. To test the hypothesis that there is a homo economicus behind privacy concerns, not just primal fear, Wathieu and Friedman conducted an experiment based on a real-world situation about the transmission of personal information in the context of car insurance. Their experiment was based on a previous case study about marketing processes that use membership databases of trusted associations (such as alumni associations) to channel targeted deals to members through a blend of direct mail and telemarketing. Key concepts include: Contrary to some research, the chief privacy concern appears based on data use, not data itself. There is consumer demand for social control that focuses on data use. Sophisticated consumers care about economic context and indirect economic effects. Closed for comment; 0 Comments.
- 18 Apr 2007
- HBS Case
How Magazine Luiza Courts the Poor
Brazilian retailer Magazine Luiza has developed an innovative strategy for selling to the poor, combining technology with great service that please both customers and employees. The question of how the company can grow without sacrificing the special qualities that have made it successful is at the heart of a case study developed by Harvard Business School professor Frances X. Frei. Key concepts include: The case "Magazine Luiza: Building a Retail Model of 'Courting the Poor'" looks at the Brazilian retailer's innovative approach to selling to the poor. Magazine Luiza sells a mix of furniture, consumer electronics, and white goods. The retailer's flexible procedure for credit approval employs nontraditional metrics, which enables customers with lower, less easily established incomes to make purchases. Students who discuss the case in the HBS classroom must assess the viability of Magazine Luiza's acquisition of another Brazilian retailer and consider future growth initiatives. Can the company retain the qualities that have made it special to both customers and employees? Closed for comment; 0 Comments.
- 07 Mar 2007
- Research & Ideas
How Do You Value a “Free” Customer?
Sometimes a valuable customer may be the person who never buys a thing. In a new research paper, Professor Sunil Gupta discusses how to assess the profitability of a customer in a networked setting—a "free" customer who nevertheless influences your bottom line. Key concepts include: In multi-sided markets, some customers contribute to a company's bottom line directly while others contribute indirect benefits, which are more difficult to calculate. Businesses must be able to assess the value of these "free" customers in order to efficiently allocate marketing and other expenses to grow the business, and to develop a more accurate estimate of firm value. Using a model for valuing networked customers, Gupta found that in an auction scenario, buyers and sellers had almost equal value even though sellers outnumbered buyers 4.6-to-1. Closed for comment; 0 Comments.
- 16 Jan 2006
- Research & Ideas
What Customers Want from Your Products
Marketers should think less about market segments and more about the jobs customers want to do. A Harvard Business Review excerpt by HBS professor Clayton M. Christensen, Intuit’s Scott Cook, and Advertising Research Foundation’s Taddy Hall. Closed for comment; 0 Comments.
- 07 Nov 2005
- What Do You Think?
Is Less Becoming More?
Americans these days have a lot more choices in products and services. But do consumers and suppliers suffer from choice overload? If so, what does this abundance mean for companies? Closed for comment; 0 Comments.
- 08 Aug 2005
- Research & Ideas
A Balanced Scorecard Approach To Measure Customer Profitability
Happy customers are good, but profitable customers are much better. In this article, professor and Balanced Scorecard guru Robert S. Kaplan introduces BSC Customer Profitability Metrics. From Balanced Scorecard Report. Closed for comment; 0 Comments.
- 04 Jul 2005
- Research & Ideas
Should You Outsource Your Marketing?
Few companies own all the marketing expertise they need, especially of the left-brain, analytic variety. Professor Gail McGovern outlines the pros and cons of turning over your marketing activities to outsiders. Closed for comment; 0 Comments.
- 19 Jul 2004
- Research & Ideas
Your Customers: Use Them or Lose Them
Companies can differentiate on service profitably, says HBS professor Frances X. Frei. Here's how a new-thinking bank, insurance provider, and software company are using customer power to win. Closed for comment; 0 Comments.
- 21 Mar 2004
- Research & Ideas
Loyalty: Don’t Give Away the Store
Loyalty programs are profitable—if used correctly. HBS Marketing professor Rajiv Lal discusses how grocery stores get it wrong. But you can get it right. Closed for comment; 0 Comments.
- 01 Mar 2004
- What Do You Think?
Are Customer Loyalty Initiatives Worth the Investment?
What are the loyalty rules? Have managers been led too far afield with customer loyalty management programs? Closed for comment; 0 Comments.
- 14 Jul 2003
- Research & Ideas
Keeping Your Balance With Customers
Using the Balanced Scorecard approach, Robert S. Kaplan, of Harvard Business School, and David P. Norton analyze the four essentials of customer management: customer selection, acquisition, retention, and growth. Closed for comment; 0 Comments.
- 23 Jun 2003
- Research & Ideas
Building a Better Buyer-Seller Relationship
How do you turn short-term transactions into long-term relationships? Harvard Business School professor Narakesari Narayandas finds answers in mature industrial markets. Closed for comment; 0 Comments.
- 30 Mar 2003
- Research & Ideas
How Your Employees and Customers Drive a New Value Profit Chain
Thinking of your customers and employees as key creators of value can produce profitable results. Harvard Business School professors W. Earl Sasser and James L. Heskett discuss their new book, The Value Profit Chain. Plus: Book excerpt. Closed for comment; 0 Comments.
- 10 Feb 2003
- Research & Ideas
Commodity Busters: Be a Price Maker, Not a Price Taker
Too many businesses are price takers, not price makers. That means they are willing to lower prices to capture market share or to sign up a marquee customer. But Harvard Business School professor Benson P. Shapiro says don't let your ego get in the way of good business sense. Here are seven steps toward naming your own price. Closed for comment; 0 Comments.
- 13 Jan 2003
- Research & Ideas
The Subconscious Mind of the Consumer (And How To Reach It)
Harvard Business School professor Gerald Zaltman says that 95 percent of our purchase decision making takes place in the subconscious mind. But how does a marketer reach the subconscious? Zaltman explains in this Q&A. Closed for comment; 0 Comments.
- 27 Oct 2002
- Research & Ideas
Want a Happy Customer? Coordinate Sales and Marketing
In today's hyper-competitive world, your sales and marketing functions must yoke together at every level—from the core central concepts of the strategy to the minute details of execution. Harvard Business School professor Benson Shapiro on creating the customer-centric team. Closed for comment; 0 Comments.
Authenticity over Exaggeration: The New Rule in Advertising
Advertisers thought technology was their friend in identifying and creating new customers. Funny thing happened along the way, though: Now consumers are using the Internet to blunt traditional commercial messages. Time for companies to rethink their strategy, says HBS professor John A. Deighton. Key concepts include: In today's media-rich world, traditional advertising models are breaking down. Now, the consumer runs the show. Successful advertising campaigns today are self-parodying and spark discussions rather than blatantly sell products. As digital interactivity increases the contexts in which people use new media, it becomes less and less productive to think of people as consumers alone. Closed for comment; 0 Comments.