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New research on marketing and supplying goods from Harvard Business School faculty on issues including distribution channels, open source distribution, overcoming "last mile" challenges, and order-taking and fulfillment.
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How Much More Would Holiday Shoppers Pay to Wear Something Rare?

by Michael Blanding

Economic worries will make pricing strategy even more critical this holiday season. Research by Chiara Farronato reveals the value that hip consumers see in hard-to-find products. Are companies simply making too many goods?

Chewy.com’s Make-or-Break Logistics Dilemma

Re: Jeffrey F. Rayport

In late 2013, Ryan Cohen, cofounder and then-CEO of online pet products retailer Chewy.com, was facing a decision that could determine his company’s future. Should he stay with a third-party logistics provider (3PL) for all of Chewy.com’s e-commerce fulfillment or take that function in house? Cohen was convinced that achieving scale would be essential to making the business work and he worried that the company’s current 3PL may not be able to scale with Chewy.com’s projected growth or maintain the company’s performance standards for service quality and fulfillment. But neither he nor his cofounders had any experience managing logistics, and the company’s board members were pressuring him to leave order fulfillment to the 3PL. They worried that any changes could destabilize the existing 3PL relationship and endanger the viability of the fast-growing business. What should Cohen do? Senior Lecturer Jeffrey Rayport discusses the options in his case, “Chewy.com (A).”

How to Get Companies to Make Investments That Benefit Everyone

by Lane Lambert

Want more organizations to give back to their communities? Frank Nagle says the success of open source software offers an innovative—and unexpected—roadmap for social good. Open for comment; 0 Comments.

Open Source Software and Global Entrepreneurship

by Nataliya Langburd Wright, Frank Nagle, and Shane Greenstein

Does more activity in open source software development lead to increased entrepreneurial activity and, if so, how much, and in what direction? This study measures how participation on the GitHub open source platform affects the founding of new ventures globally.

Will Challenged Amazon Tweak Its Retail Model Post-Pandemic?

by James Heskett

James Heskett's readers have little sympathy for Amazon's loss of market share during the pandemic. Has the organization lost its ability to learn? Open for comment; 0 Comments.

The Impacts of Increasing Search Frictions on Online Shopping Behavior: Evidence from a Field Experiment

by Donald Ngwe, Kris J. Ferreira, and Thales Teixeira

This paper challenges the logic that making it easier for consumers to search across a wide assortment of products is the best strategy for online retailers. Experiments show that adding extra search costs to find discounted items can improve gross margins and sales by increasing the number of items inspected and serving as a self-selecting price discrimination mechanism among customers.

How to Use Free Shipping as a Competitive Weapon

by Kristen Senz

Free shipping is an increasingly important tool in the online retailer's marketing arsenal, but profit is lost when not done right, says Donald Ngwe. Open for comment; 0 Comments.

The Hidden Benefit of Giving Back to Open Source Software

by Kristen Senz

Firms that allow their software programmers to "give back" to the open source community on company time gain benefits—even though competitors might benefit too, says Frank Nagle. Open for comment; 0 Comments.

Amazon, Whole Foods Deal a Big Win for Consumers

by Jose Alvarez and Len Schlesinger

What does Amazon's $13.4 billion deal for Whole Foods say about the future of retail? Harvard Business School professors Jose Alvarez and Len Schlesinger see good times ahead for consumers as well as both companies. Open for comment; 0 Comments.

Money and Quotas Motivate the Sales Force Best

by Roberta Holland

Bonus programs are effective for motivating sales people, but also costly for companies to maintain. Doug Chung and Das Narayandas study several compensation schemes to see which work best. Open for comment; 0 Comments.

Incentives versus Reciprocity: Insights from a Field Experiment

by Doug J. Chung & Das Narayandas

Sales force compensation is a key instrument available to firms for motivating and enhancing sales performance. What are the most effective forms of compensation? In a field experiment involving four regional sales forces of a prominent firm in India, the authors examined the impact of conditional and unconditional bonus schemes. Findings from this study provide guidance to firms on how to use conditional and unconditional compensation to enhance sales rep productivity and better manage the achievement of sales forecasts. Closed for comment; 0 Comments.

Digital Initiative Summit: The Business of Crowdsourcing

by Dina Gerdeman

Gaining the community's trust is vital to building a successful business with crowdsourcing. Open for comment; 0 Comments.

Where Did My Shopping Mall Go?

by Sean Silverthorne

The growing popularity of online shopping is remaking the world of offline shopping—stores are getting smaller, malls are getting scarcer. Rajiv Lal and José Alvarez look ahead five years at our radically transforming shopping experience. Plus: Book excerpt. Open for comment; 0 Comments.

Retail Reaches a Tipping Point—Which Stores Will Survive?

by Sean Silverthorne

Part 1: The new book Retail Revolution: Will Your Brick and Mortar Store Survive? argues that ecommerce is about to deal severe blows to many familiar store-based brands—even including Walmart. Here's how retailers can fight back, according to Rajiv Lal, José Alvarez, and Dan Greenberg. Open for comment; 0 Comments.

Why Do Outlet Stores Exist?

by Michael Blanding

Created in the 1930s, outlet stores allowed retailers to dispose of unpopular items at fire-sale prices. Today, outlets seem outmoded and unnecessary—stores have bargain racks, after all. Donald K. Ngwe explains why outlets still exist. Open for comment; 0 Comments.

The Strategic Way To Hire a Sales Team

by Carmen Nobel

The equivalent of an entire sales force is replaced at many firms every four years, so it's critical that go-to-market initiatives remain tied to strategic goals. Frank Cespedes explains how in his book, Aligning Strategy and Sales. Closed for comment; 0 Comments.

The Tricky Business of Managing Web Advertising Affiliates

by Kim Girard

Advertising through numerous website affiliates potentially helps marketers get more bang for their buck. But the far-flung systems can also lead to fraud, says Ben Edelman. What's the best way to manage your advertising network? Closed for comment; 0 Comments.

How to Do Away with the Dangers of Outsourcing

by Ranjay Gulati

The collapse of the Rana Plaza garment factory in Bangladesh should be a warning to companies that embrace outsourcing, says Professor Ranjay Gulati. Closed for comment; 0 Comments.

Learning Curve: Making the Most of Outsourcing

by Paul Guttry

Companies that view outsourcing as an easy way to offload commodity work are missing powerful improvements to be gained by working closely with service providers, says Professor Robert S. Huckman. Open for comment; 0 Comments.

Diasporas and Outsourcing: Evidence from oDesk and India

Re: William R. Kerr

Diaspora-based exchanges have been important for centuries, but the online world reduces many of the frictions these networks solved. How do the Internet and diaspora networks connect? This study investigated the importance of Indian diaspora connections on the oDesk platforms for outsourcing. oDesk is the world's largest online labor market, processing $30 million per month in contracts as of May 2012. This research finds strong evidence that diasporas still matter and influence economic exchanges even when many frictions are minimized. In fact, the case study suggests more often than not that diaspora use increases as familiarity with the platform increases. This suggests a longer-term complementarity between diaspora networks and online tools that may aid the persistence of these networks. At the same time, the oDesk evidence also makes clear that the role of diaspora networks should not be overstated. While they contributed to India's success on oDesk, diaspora connections were clearly not a driving force in India becoming the top destination for oDesk contracts. Key concepts include: The frictions that online platforms like oDesk minimize are frictions that diaspora networks have historically been used to overcome. This makes their role for future economic exchanges uncertain. Diaspora connections still matter. Ethnic Indians working in countries outside of India are 32 percent (9 percentage points) more likely to choose a worker in India than non-ethnic Indians. Yet, even with the increased likelihood of outsourcing to India, diaspora connections played a very small role in India's rapid development on oDesk. In fact, diaspora connections appear to follow rather than lead the platform's development. Diaspora connections occur through the actions of many people in small ways and the extreme concentration of impact due to a few key people. Diasporas will continue to use online platforms in an effective manner, but diasporas will not be responsible for a country's overall success on the platform, at least in countries of moderate to large size. Closed for comment; 0 Comments.