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When Does Downsizing Hurt Customer Satisfaction?

Idea posted: April 2015
  • Strategy
  • Marketing
  • Operations

Past research based on B2B industries show an intuitive link between downsizing the workforce and lower customer satisfaction. A new study focused on B2C industries reveals that the link is more complex, depending on factors such as organizational slack, labour productivity, and the emphasis on innovation. The study does confirm that downsizing reduces customer satisfaction, which then reduces financial results.

Idea #507
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Alexander Graham Bell at the opening of the long-distance line from New York to Chicago, 1892 (Courtesy: Library of Congress)

Incentivizing Older Consumers to Adopt New Technologies

Idea posted: March 2015
  • Marketing

Companies traditionally ignore older consumers when marketing new technologies and innovations. While the non-monetary adoption costs to older consumers are high as previous research suggests, a new mathematical model — that looks at consumers over their entire lifecycle — reveals that monetary costs to older consumers actually decrease with age. 

Idea #502
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Work with Customers to Understand and Shape their Future Needs

Idea posted: March 2015
  • Innovation & Entrepreneurship
  • Marketing

Understanding future customer needs is a key success factor for competitive advantage. However, an equally important success factor, and one that is often overlooked, is the ability of companies to influence customers on their future needs. Companies that can both understand and shape future customer needs have the greatest chances of future success.

Idea #494
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Harness Big Data Using Visualisation Software Tools

Idea posted: January 2015
  • Strategy
  • Innovation & Entrepreneurship
  • Marketing
Institutions: NUS Business School

The phrase “big data” puts the emphasis on quantity — and it’s true that the data available in the world continues to grow exponentially every year. But for businesses wanting to make the most of big data, it’s not quantity that counts, but what you do with the data. Companies are losing millions of dollars because they are not fully exploiting the data they are already gathering. Given the complexity of big data, visualisation software tools are required to help companies avoid this mistake.

Idea #474
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William Glackens, The Shoppers, 1907-1908, Chrysler Museum of Art, Norfolk, Virginia

How Price Expectations Drive Customer Purchasing Decisions

Idea posted: November 2014
  • Marketing

Customers have price expectations in their minds before entering a store, as well as expectations of prices in other stores. How customers update their expectations once they see the actual prices can help businesses better manage their promotions and sales for maximum effect. 

Idea #463
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The Tribuna of the Uffizi (detail), Johann Zoffany, circa 1772-1778, The Royal Collection, Windsor Castle

What to Get Right when Crowdsourcing

Idea posted: October 2014
  • Innovation & Entrepreneurship
  • Marketing
  • Operations

Social media channels have enabled organizations such as Dell, Starbucks, and NASA to successfully reach out to external contributors to collect suggestions, which have in turn stimulated innovation. This research, however, shows that most initiatives to source external contributions fail and that organizations seeking external ideas need to proceed with care and establish proactive processes to avoid potential pitfalls.

Idea #455
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Social Media Grabbing a Major Share of the Marketing Budget

Idea posted: October 2014
  • Marketing

Companies will be steadily increasing their spending on social media marketing in the next few years, even though most marketing executives cannot measure the financial impact of such spending. The shift in consumer buying patterns to online makes a shift to social media marketing a logical step, despite the current inability to demonstrate ROI. The pressing issue now is for companies to integrate social media activities into their general marketing campaigns. 

Idea #456
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Shanghai Xin Tian Di, photo by Motohiko Tokuriki, 2010 (Source: Wikimedia Commons)

Why Increasing Demand Is Not Always the Answer to New Competition

Idea posted: October 2014
  • Strategy
  • Marketing

Faced with a new competitor in the market, an incumbent company is usually expected to respond by investing more into its products to offer products that will please more customers. However, new research shows that a higher product investment in response to competition is not necessarily the best answer. The reason: new entrants may change the incumbent’s return on investment trade-off.

Idea #450
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Markdown Vs Everyday-Low-Prices: The Impact of Regret and Availability Misperceptions

Idea posted: October 2014
  • Strategy
  • Learning & Behaviour
  • Marketing

The behavioural motives of consumers — such as regret over buying too soon or too late and misperceptions about the product’s future availability — should be considered as companies develop their optimal pricing and inventory strategies.

Idea #453
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Marion A. Trozzolo (1925 –1992) was an innovator, inventor, entrepreneur and  the first manufacturer of teflon coated cookware (Source: Wikimedia Commons)

Should Technology Innovators Participate in the Commercialization Process?

Idea posted: October 2014
  • Strategy
  • Innovation & Entrepreneurship
  • Marketing
  • Operations

Conventional wisdom has it that technology based entrepreneurs are better off commercializing their product by contracting with an incumbent (i.e. licensing). But this trade-off may not always be optimal, because if the innovator can learn from its own commercialization experience, albeit losing some profit initially, it could avoid making the same trade-off with future innovations, thus securing long-term profitability. Alternatively, joint commercialization may be the best approach.

Idea #448
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Gedränge vor dem Geschäft Thomas Prewein, by Josef Engelhart, 1941 (Source: Wikimedia Commons)

The Surprising Benefit of Long Queues for Customers and Business

Idea posted: October 2014
  • Innovation & Entrepreneurship
  • Marketing

The accepted wisdom is that long lines are bad for business. In fact, they can be very good for business, as long as they are not too long. Research shows that long lines help customers learn what’s worth waiting for, and help businesses attract uninformed customers.

Idea #446
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Replica of Rushworh's music store in Liverpool, where the Beatles bought their first Gibson guitars (Source: Wikipedia Commons)

When Showrooms Help Online Companies

Idea posted: August 2014
  • Marketing
  • Operations

Nearly every bricks-and-mortar company will have an online presence today. But a few intrepid companies are going in the opposite direction: online companies are starting to open offline showrooms — and research shows the result is a boost in sales… and happy customers.

Idea #434
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EU Energy Label

Why Differentiating Rating Scale Labelling is Important

Idea posted: August 2014
  • Marketing

Rating scales, such as those used in online review platforms or stores (for example, Amazon or Tripadvisor) or by government rating agencies (such as agencies rating energy savings), allow consumers to evaluate the performance of products or services. However, new research shows that when the scale levels of the rating scale are not distinguished visually (e.g. by colour) or linguistically (e.g. using the linguistically different A, B, C, D rather than A, A+, A++, A+++), consumers are more likely to ignore them — and this can hurt the sales. 

Idea #431
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Three Product Innovation Strategies for Emerging Markets and How to Choose

Idea posted: August 2014
  • Innovation & Entrepreneurship
  • Marketing

Emerging markets such as India or China represent lucrative new markets but also present a set of challenges, including lower income customers, poor infrastructure and poor service availability. There are three fundamentally different types of product and service innovation that can serve these markets: cost, frugal and good-enough innovation. Understanding the differences can help companies choose the right emerging market product innovation strategy for them.

Idea #430
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Naremon Thepchai Theatre production of Arthur Miller's 'Death of a Salesman', 1971(Source: Wikimedia Commons)|

Do Your Managers’ Responses to Market Results Damage Profits?

Idea posted: August 2014
  • Strategy
  • Leadership & Change
  • Marketing
  • Operations

Self-serving biases can lead managers to make less than optimal decisions when faced with poor results. This can hurt profits as their biases lead to the wrong quality and price responses to market results. However, forward looking executives can take steps to pre-emptively counter those biases when they make their initial price and quality improvement decisions.

Idea #423
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The Unexpected Impact of Click and Collect Retail Programs

Idea posted: June 2014
  • Strategy
  • Marketing
  • Operations

When retailers started offering the ‘buy-online, pickup-in-store’ option, also known as BOPS, the assumption would be that online sales would increase. New research shows, however, that BOPS actually reduces online sales while increasing offline sales — a surprising but positive result.

Idea #527
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The Intrigue, James Ensor, 1890 (Courtesy: The Royal Museum of Fine Arts Antwerp)

How Crowdfunding Affects Product and Pricing Decisions

Idea posted: June 2014
  • Finance
  • Innovation & Entrepreneurship
  • Marketing

Seeking investors through crowdfunding sites such as Kickstarter requires entrepreneurs to rethink their pricing and product line strategies, taking into account the mix of investor/buyers who will attach different levels of value to the new product or service.

Idea #402
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"Your reputation precedes you" Lord Nelson to Lady Hamilton. Laurence Olivier and Vivien Leigh in That Hamilton Woman, 1941, produced and directed by Alexander Korda, distributed by United Artists.

How to Measure and Manage Reputation

Idea posted: May 2014
  • Strategy
  • Leadership & Change
  • Marketing
  • Operations
Institutions: Henley Business School

Reputation management is a complex task and the measurement of it particularly so, concerned as it is with diverse stakeholder groups and their respective, sometimes differing, evaluations of an organization. Getting the right level of engagement with stakeholders is a critical factor in a firm achieving its objectives, because from that engagement business recommendation and take-up will flow.

This research focuses on the pharmaceutical industry, although the model it uses is transferable to other industries and therefore offers potential to the wider corporate communication and

Idea #378
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Building a Brand Image Across Multiple Countries

Idea posted: April 2014
  • Marketing

Multi-country brands should position themselves consistently across markets only on image attributes that are very important in all of the various countries. For example, brand image attributes related to benevolence or self-direction, which are valued highly in most countries, can be used consistently. Better to be inconsistent (used in certain markets only) with a divisive value such as hedonism or power.

Idea #372
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1956 Ballantine Ale original vintage advertisement (Source: Brookston Beer Bulletin)

Ambiguous Ads: Hidden Messages, Hidden Risks?

Idea posted: April 2014
  • CSR & Governance
  • Marketing

Companies sometimes use covert ‘cues’ and ambiguous images to advertise their products. This ‘purposeful polysemy’ enables them to target minority groups without alienating ‘mainstream’ consumers. It is not, however, a foolproof strategy. Research suggests that heterosexual men respond less positively to ‘gay window’ advertising.

Idea #360
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"Drink Coca-Cola 5¢", an 1890s advertising poster (Source: Wikimedia Commons) 

How Advert-Evoked Feelings Sway Attitudes to Brands

Idea posted: April 2014
  • Marketing

A new study, recreating real-world marketplace conditions, shows that positive feelings evoked by ads can create positive feelings toward brands, both directly and indirectly. This applies to all products, although hedonistic products show the greatest impact of ads on brand attitudes.

Idea #363
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‘Dans le Souk aux Cuivres’, Nicola Forcella, an Italian painter born before 1868 (Source: Wikimedia Commons)

How Customer Participation Builds Loyalty

Idea posted: April 2014
  • Marketing

Companies focus on encouraging customer word-of-mouth while ignoring the benefit of customer participation — encouraging customer feedback and suggestions to the company. Yet, research shows that participation can increase customer loyalty even more than word-of-mouth. 

Idea #364
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Robert Hooke, at Christ Church Oxford, where he studied surrounded by some of his inventions. Painting by Rita Greer 2011 (Source: Wikimedia Commons)

Great Innovation! But What’s it for? Marketers Beware

Idea posted: April 2014
  • Innovation & Entrepreneurship
  • Marketing

Product designers and marketers might be very excited about a new product with impressive new features and a bold new design. But consumers will not recognize the newness of the product if they cannot figure out what the product is in the first place — which can lead to a major disconnect between the reaction that companies expect from consumers (“Wow, what a great innovation!) and the actual reaction (“What is it?”).

Idea #355
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Online Customers Reviews: Loyalty and Deception

Idea posted: April 2014
  • Marketing

While it might seem easy for competitors to hurt a rival’s sales by posting negative reviews, research reveals that many of the most negative product reviews are written by loyal customers trying to influence company strategy. 

Idea #356
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Guests lounge at the pool at the Dolphin Village Hotel in Shavei Zion, 1954 (Source: Wikimedia Commons)

The Overlooked Longevity of Experiential Goods

Idea posted: March 2014
  • Marketing

When consumers feel financially constrained, they are more likely to choose tangible material purchases over experiential purchases in the belief that those material purchases will ‘last’ longer. This longevity factor can be deceiving, however; material purchases can often be more frivolous (and thus less valuable) than experiential purchases — and experiential purchases can last longer, through memories or well-being for example, than material ones.

Idea #351
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 A typical "As seen on TV" logo present on many products in the US (Source: Wikimedia Commons)

Brand Placement on TV: The Positive Impact of Fast-forwarding

Idea posted: March 2014
  • Marketing

Placing brands with different ‘personalities’ next to each other, as in a block of ads during a TV commercial break, impacts how consumers view the brands, new research shows. For example, a safe, efficient product seems like a more exciting choice simply because its ad followed the advertisement for another product that emphasizes excitement and adventure. But this brand-pairing effect only happens when consumers are not paying too much attention to either brand… as when they’re fast-forwarding through the commercials of a taped TV show.  

Idea #347
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The big queue at an ATM in Masalli, Azerbaijan, 2008 (Source: Wikimedia Commons)

Customer Loyalty: Easy Does It

Idea posted: March 2014
  • Marketing
Institutions: Henley Business School

A number of companies have begun to measure ‘customer effort’ (CE) – how easy (or difficult) it is for their customers to interact with them. The experience of these firms is that CE is worthwhile, offering a good indicator of customer loyalty. Whilst it should not replace other key measures, such as customer satisfaction and ‘net promoter score’ (NPS), it should be considered alongside them.

Idea #345
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The Distribution of Bread in the Village, Frans van Leemputten, 1892 (Source: Wikimedia Commons)

Do CSR Initiatives Enhance Customer Loyalty?

Idea posted: March 2014
  • CSR & Governance
  • Marketing

Are customers more loyal to retailers who engage in corporate social responsibility (CSR) activities? In general, CSR is going to earn customer loyalty, although a closer look reveals that the type of CSR makes a difference. CSR related to the customer experience — involving employees and products — inspires the most loyalty, followed by community support activities. Environmental projects generate less enthusiasm from customers, and with some customers actually have a negative effect.

Idea #346
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How Price, Time and Functionality Affect Customers' Choices

Idea posted: March 2014
  • Learning & Behaviour
  • Marketing

New research shows that when purchases are time-sensitive — buying a camera the day before leaving for vacation, for example — consumers tend to look for convenient, easier-to-use products. But in the long term, consumers are more interested in desirable product features. According to the research, reminding consumers of a product’s price will help them focus, even in the short term, on what they truly value: functionality over convenience.

Idea #338
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The Three Wise Men at Nuevos Ministerios Metro and Cercanías station, Madrid (Source: Wikipedia Commons)

Optimal Marketing Claims: The Power of Three

Idea posted: February 2014
  • Learning & Behaviour
  • Marketing

When putting together an advertisement campaign, how many positive aspects of the product should you include? The temptation is to put in as many as possible, but according to this Idea, three is the optimal amount. Add more and you risk raising suspicions in your customers about the authenticity of all of the claims. 

Idea #328
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