Teaching Insights

An increasing number of online retailers (e.g. Amazon) are investing billions of dollars in building their own delivery services (ODS) and delivering products to customers’ homes through their own logistics network. ODS not only improves delivery quality but also builds customer trust, which together increases customers’ monthly spending, purchase frequency, and the number of items ordered. ODS has greater value for markets with lower trust levels, infrequent customers, high-risk product categories, and consumers who prefer the focal retailer.

Related Marketing Courses: ​
Digital Marketing, Retail Marketing

Full Citation: ​
Wu, Banggang, Yubo Chen, and Prasad A. Naik, “How Own Delivery Services Influence Customer Behavior and Sales in Online Retail? Building Trust and Improving Delivery Quality in Digital Economy,” Journal of Marketing, forthcoming.

Article Abstract: 
Online retailers worldwide invest beyond their core business of retailing to offer own delivery services (ODS) to deliver products to customers’ homes through their own logistics network. How does this shift to ODS affect customers’ behaviors and sales performance? When and why do retailers venture beyond their core competence to offer ODS? To explore these questions, the authors analyze 250,055 customer transactions over 10 years across 416 cities and 49 product categories from JD, a major online retailer in China. Using difference-in-differences model, causal mediation analysis, and synthetic control method, they find that ODS increases customers’ monthly spending by 7.8% and grows the city-level sales by 11.9%. This study is the first one to quantify the sales impact of ODS and shed light on when and why it works. The findings reveal that ODS has greater value for markets with lower trust levels, infrequent customers, high-risk product categories, and consumers who prefer the focal retailer (versus that of third-party sellers). Causal mediation analysis further reveals that ODS not only improves delivery quality, but also builds customer trust, which together increase customers’ monthly spending, purchase frequency, and the number of items ordered.

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Teaching Insights

1. Owned social media elasticity on sales is higher than on social media engagement: Although managers are investing increasingly more in owned social media, they tend to monitor the effectiveness of their owned social media posts using metrics that are relatively easy to gather, such as those linked to social media engagement (e.g., likes, comments, shares). If brands were to focus on engagement metrics, they may underestimate the impact of their social media. In fact, we also find that what drives the effect on social media engagement does not necessarily work for sales.
2. Contrary to popular belief, emotional content is more effective for social media engagement compared to social content (e.g., calls for action, questions): Although social content helps brands stand out online, it is less powerful than emotional content as the emotional arousal fosters message liking and sharing.
3. Surprisingly, deals content has no superior impact, even if marketers have named it as one of their top three reasons for using social media: Informational content is more effective, as it aids consumers in their purchase decisions.
4. Context matters. The effect of owned social media on sales is stronger…

• …in smaller than larger brand communities: It is more important to focus on the quality rather than quantity of followers, to better understand and address consumer needs and expectations and create more authentic and intimate interactions.
• …for new products than mature products: Managers can benefit from creating content about new products on social media, boosting sales.
• …in countries with higher mobile phone penetration and higher power distance: Because many platforms are international, using one global social media strategy is tempting, but managers cannot count on the same type of response across countries.

Full Citation:

Liadeli G, Sotgiu F, Verlegh PWJ (2022), “A Meta-Analysis of the Effects of Brand Owned Social Media on Social Media Engagement and Sales,” Journal of Marketing. doi:10.1177/00222429221123250

Article Abstract:

What are the effects of a brand’s owned social media? This meta-analysis examines the impact of owned social media on social media engagement and sales. Whereas the findings support some current beliefs, e.g., owned social media are more effective to boost sales for new (vs. mature) products, it highlights several novel insights. Contrary to popular beliefs that owned social media mainly drive engagement and hardly affect sales, the results show the opposite with an average elasticity of .137 for social media engagement and .353 for sales. In addition, the results suggest ways to better adapt owned social media content to communication goals. To create engagement, content needs to focus on emotional needs and steer away from deals, which are the least effective content type. To stimulate sales, content should not be emotional, but rather be more functional in nature, and communicate product benefits. Surprisingly, we find that growing a large social media community is not essential for boosting sales, as owned social media are more effective for brands with fewer followers. Furthermore, while using one global social media strategy is tempting, owned social media are more effective in countries with high power distance, calling for a less uniform approach.

Special thanks to Duke University, for his support in working with authors on submissions to this program.

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Teaching Insights

Brands have tremendous opportunities to disseminate socially relevant messages embedded in the narratives of their TV ads to impact socially beneficial outcomes. Brands should be strategic about their advertising not just from a brand-outcome standpoint, but also from a societal-outcome standpoint. Brand advertising can indeed do societal good!

Related Marketing Courses: ​
Advertising and Promotion; Marketing Strategy

Full Citation: ​
Ayan Ghosh Dastidar, Sarang Sunder, Denish Shah (2022), “,” Journal of Marketing, doi: 10.1177/00222429221130011

Article Abstract: 
Can TV Advertising affect societal outcomes beyond traditional marketing outcomes such as sales and brand awareness? The authors address this question in the context of the COVID-19 pandemic by analyzing daily advertising and mobility data for 2,194 counties across 204 Designated Market Areas in the US. By employing a border identification strategy that exploits discontinuities across television markets, the authors find a significant positive causal relationship between TV ads from brands containing COVID-19 narratives, and people’s social distancing behavior while controlling for government policy interventions (e.g., shelter-in-place, mask mandates). The estimated effects are almost 11 times larger in counties without government policy interventions (compared to counties with policy interventions). Notably, while the overall impact of government ads on social distancing behavior is non-significant, the effect becomes significantly negative (positive) in the presence (absence) of policy interventions. The results are robust to alternative model specifications, variable operationalizations, and other data considerations. The findings underscore the critical role that spillover effects from brand-sponsored TV ads can play during major public crises, including mitigating the lack of local governments’ policy interventions. The findings bear substantive implications for managers and policymakers regarding how advertising strategies may help improve public health outcomes or advance social good.

Special thanks to Duke University, for his support in working with authors on submissions to this program.

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Teaching Insight:

A decentralized onboarding program can develop salespeople into higher performers than a centralized onboarding program can, partly due to its ability to foster in newcomers a more innovative and adaptive approach to their role.

Related Marketing Courses:
Salesforce Management

Full Citation:
Wiseman, Phillip, Michael Ahearne, Zachary Hall, and Seshadri Tirunillai, (2022) “,” Journal of Marketing, https://doi.org/10.1177/00222429221076437

Abstract:
The effective training of salespeople is crucial to a firm’s success; there is arguably no more critical type of training than a salesperson’s onboarding. In this study, the authors leverage a natural field experiment in which a firm’s newly hired salespeople can undergo onboarding through either a decentralized program or a centralized program to examine the relative impact of each program. Drawing on organizational socialization theory, the authors consider whether an onboarding program that incorporates both individualized and institutionalized socialization tactics (the decentralized program) can develop salespeople into higher performers by encouraging them to take a more innovative and adaptive approach to different facets of the sales role. The findings reveal that salespeople who underwent the decentralized program achieved approximately 23.5% higher sales performance than those who underwent the centralized program. The performance benefits of the decentralized program were amplified for salespeople whose managers had a narrower span of control. In addition, these performance benefits were appreciable for those salespeople transitioning from another job but negligible for those transitioning from school. A scenario-based experiment enriches the field experiment’s findings by showing evidence of the theorized mechanism underlying the sales performance benefits observed: the fostering of an innovative role orientation.

Special thanks to , Ph.D. candidate at Duke University, for support in working with authors on submissions to this program.

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Teaching Insight:

Stock market pressures are known to reduce manager incentives to invest in breakthrough innovations. Innovation imprinting, which captures establishing product priorities and building market capabilities before the firm goes public, helps companies remain innovative after the IPO. This works because innovation imprinting attracts a segment of concordant investors whose risk preferences are more supportive of innovation.

Related Marketing Courses:
Innovation/New Product Development; Marketing Strategy; Principles of Marketing; Core Marketing; Intro to Marketing Management

Full Citation:
Wies Simone, Christine Moorman, and Rajesh K. Chandy (2022). “,” Journal of Marketing, https://doi.org/10.1177/00222429221114317

Abstract:
Growth and innovation are primary arguments for firms seeking to go public and access resources from the stock market. So it is poignant that going public is, for a majority of firms, associated with a pronounced slump in breakthrough innovation. This paper proposes an actionable, marketing-related explanation for why some firms that go public manage to beat the post-IPO innovation slump: innovation imprinting. The paper argues and demonstrates that those firms that engage in innovation imprinting before they go public attract a segment of concordant investors whose risk preferences are more supportive of breakthrough innovation than investors at large. These investors, in turn, reward the firms’ continued introduction of breakthrough innovations after they have gone public. By analyzing the innovation patterns of 207 firms in the consumer-packaged goods sector before and after an IPO, we observe that one-third of firms are able to maintain or beat their pre-IPO levels of breakthrough innovations after going public. By studying their actions, the investors they attract, and their financial performance and survival rates, we provide empirical evidence for the importance of innovation imprinting and concordant investors in helping firms beat the post-IPO innovation slump.

Special thanks to , Ph.D. candidate at Duke University, for support in working with authors on submissions to this program.

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Teaching Insight:

The marketing literature has defined authenticity as a perceptual quality that consumers attribute to a brand. Following this definition, research has sought to identify the essential features that brands, business, or celebrities possess, which drive these perceptions of authenticity and conversely, to identify the contrasting features that generate perceptions of inauthenticity. We argue that this conventional approach, while making intuitive sense, is unable to effectively grapple with the cultural complexity manifest in the process of “authenticating” a brand.  Using semiotic theory, we develop a framework that marketing managers can use to analyze the cultural contradictions of authenticity that can undermine their authenticity claims.

Related Marketing Courses:
Advertising and Promotion; Brand Management; Consumer Behavior; Marketing Strategy

Full Citation:
Thompson Craig J., Ankita Kumar (2022), “,” Journal of Marketing, 86 (5). doi:10.1177/00222429221087987

Abstract:
This research analyzes the cultural contradictions of authenticity as they pertain to the actions of consumers and marketers. Our conceptualization diverges from the conventional assumption that the ambiguity manifest in the concept of authenticity can be resolved by identifying an essential set of defining attributes or by conceptualizing it as a continuum. Using a semiotic approach, we identify a general system of structural relationships and ambiguous classifications that organize the meanings through which authenticity is understood and contested in a given market context. We demonstrate the contextually adaptable nature of this framework by analyzing the authenticity contradictions generated by the cultural tensions between conscious capitalism—a market logic that encompasses both global brands and small independent businesses, such as a farm-to-table restaurant or an organic food co-op—and the elitist critique. The Slow Food movement provides our case study of how consumers, producers, and entrepreneurs who identify with conscious capitalist ideals understand these disauthenticating, elitist associations and the strategies they use to counter them. We conclude by discussing implications of our analysis for theories of authenticity and for managing the authenticity challenges facing conscious capitalist brands.

Special thanks to and , Ph.D. candidates at Duke University, for support in working with authors on submissions to this program.

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Teaching Insight:

The slides describe the nature, functioning, and performance relevance of Machiavellianism in alliance partnerships. The paradox of Machiavellianism is that it is a strategy a firm uses to manipulate the partner to improve its own gain, but doing so is likely to prove detrimental to its performance in the alliance. Our Theories-in-Use discussions surfaced manifestations of Machiavellianism’s behavioral side that would allow the detection of a Machiavellian partner. Machiavellian firms are likely to exhibit behaviors that reflect its dimensions, such as hypervigilance, authoritative work patterns, and calculative adaptations. Managers’ ability to harness shared experiences provides a way to work with these firms more successfully.

Related Marketing Courses:
Business-to-Business Marketing

Full Citation:
Musarra, Giuseppe, Matthew J. Robson, and Constantine S. Katsikeas (2022), “,” Journal of Marketing, https://doi.org/10.1177/00222429221100186.

Abstract:
Against a backdrop of limited research focusing on dark-side characteristics in alliances, the authors argue that Machiavellianism in the alliance influences strategies pertaining to learning new knowledge and using power to achieve better performance effectiveness. They develop a model using theories-in-use procedures and drawing from both Machiavellian intelligence and achievement goal perspectives, which they test in a quasi-longitudinal study of 199 marketing alliances. The results suggest that Machiavellianism relates negatively to collaborative learning and positively to learning anxiety and use of power. The findings also indicate that collaborative learning enhances performance while learning anxiety and use of power result in underperformance. Collaborative learning, learning anxiety, and use of power fully mediate Machiavellianism’s impact on performance. Finally, Machiavellianism’s relationships with collaborative learning and learning anxiety are moderated positively and negatively, respectively, by partners’ collaborative history. This evidence provides managers with a more in-depth understanding about the nature, functioning, and performance relevance of Machiavellianism in alliance partnerships.

Special thanks to , Ph.D. candidate at Duke University, for support in working with authors on submissions to this program.

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Teaching Insight:

This research examines the impact of premium organic specialist store entry on category sales at incumbent generalist stores. The results indicate that incumbent stores lose about 3% in sales after a local organic store entry. The study also examines managerially relevant factors that can influence the magnitude of sales losses. The results show that incumbent generalist stores can reduce sales losses by reducing the relative distinctiveness of the entrant along three dimensions: variety, price-quality, and authenticity.

Related Marketing Courses:
Marketing Strategy, Retail Marketing

Full Citation:

Maesen, Stijn and Lien Lamey (2022), “,” Journal of Marketing, doi: 10.1177/00222429221090983

Abstract:
Premium organic retailers are specialist retailers that exclusively offer organic products. Past literature has not studied their entry, focusing instead on the impact of generalist store entry, such as Wal-Mart. This study examines the impact of premium organic specialist store entry on category performance at incumbent generalist stores for 47 packaged food and beverages categories. The results indicate that incumbent stores lose sales after a local organic store entry, and that the impact of price on sales at generalist stores becomes stronger. The authors postulate that incumbent stores can reduce sales losses by reducing the relative distinctiveness of the entrant along three dimensions: variety, price-quality, and authenticity. Empirical results show that more variety in organic products as well as more organic feature and display advertising protect generalist stores from premium organic specialist store entry. Assortments composed of premium organic products are harmed less, whereas assortments where organic products are subject to more frequent and deeper price promotions are harmed more. Furthermore, including products from an organic specialist brand in generalist’s organic assortments, offers additional protection.

Special thanks to , Ph.D. candidate at Duke University, for support in working with authors on submissions to this program.

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Teaching Insight:

More than 65 million firms leverage online brand communities to connect with customers and increase online reputation, brand patronage, and customer spending. However, online communities are vulnerable to online firestorms, or negative eWOM, that receives substantial support from other customers in a short period of time. A Journal of Marketing study explores the conditions that make eWOM go viral and how to detect, prevent, and mitigate online firestorms:

• Different types of emotional arousal, the strength of the senders’ structural ties, and their similarity to the online brand community contribute to the virality of negative eWOM.

• Using a dictionary-based, straightforward, automatic text-mining approach can help firms detect potential online firestorms.

• Response strategies should vary by message type. More explanatory responses are best for negative eWOM messages containing above-average negative high arousal emotions; the effectiveness of disengaging approaches varies.

Related Marketing Courses:
Brand Management; Digital Marketing; Marketing Communications; Services Marketing; Social Media Marketing

Full Citation:
Herhausen, Dennis, Stephan Ludwig, Dhruv Grewal, Jochen Wulf, and Marcus Schoegel, M. (2019), “,” Journal of Marketing, 83 (3), 1–21.

Abstract:
Online firestorms pose severe threats to online brand communities. Any negative electronic word of mouth (eWOM) has the potential to become an online firestorm, yet not every post does, so finding ways to detect and respond to negative eWOM constitutes a critical managerial priority. The authors develop a comprehensive framework that integrates different drivers of negative eWOM and the response approaches that firms use to engage in and disengage from online conversations with complaining customers. A text-mining study of negative eWOM demonstrates distinct impacts of high and low arousal emotions, structural tie strength, and linguistic style match (between sender and brand community) on firestorm potential. The firm’s response must be tailored to the intensity of arousal in the negative eWOM to limit the virality of potential online firestorms. The impact of initiated firestorms can be mitigated by distinct firm responses over time, and the effectiveness of different disengagement approaches also varies with their timing. For managers, these insights provide guidance on how to detect and reduce the virality of online firestorms.

Special thanks to , Ph.D. candidate at Duke University, for support in working with authors on submissions to this program.

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Teaching Insight:

A new study in the Journal of Marketing shows that the design of websites used for buying health insurance combined with high-quality big data can produce big savings for consumers. When health insurance products are ordered such that the best options for the consumer appear first in the presented list, this strongly improves consumers’ decisions. If the list is also partitioned to show a small number of options first (with an easy option to click through to see all options), this further improves consumers’ decisions. However, importantly, if the best options are not at the top of the list, partitioning can harm consumer decision quality.

Making good health insurance decisions is important to health outcomes and longevity, but consumers’ errors are well documented. This paper examines the interaction of two choice architecture tools: ordering the options from best to worst based on a high-quality user model and partitioning the total set of options. While ordering and partitioning do not always improve choices separately, the results of one field study and three experiments identify the conditions that allow the combination to greatly improve health insurance decisions. Process data shows that these effects are achieved by focusing consumers’ limited attention on higher quality options.

Thus, ordering and partitioning health insurance options based on a high-quality predictive user model is an inexpensive and efficient way to apply firm-level knowledge to improve social welfare. Firms in healthcare can use this knowledge to develop new business models that deliver long-term value for consumers, firms, and other stakeholders.

Related Marketing Courses:
Advertising and Promotion; Consumer Behavior; Digital Marketing; Marketing Analytics; Marketing Communications; Retail Marketing

Full Citation:
Dellaert, Benedict G.C., Eric J. Johnson, Shannon Duncan, and Tom Baker (2022), “.” Journal of Marketing. doi:10.1177/00222429221119086

Abstract:
Making good health insurance decisions is important to health outcomes and longevity, but consumers’ errors are well documented. The authors examine if targeted choice architecture interventions can reduce these mistakes. The paper examines the interaction of two choice architecture tools on improving consumer insurance decisions in online healthcare exchanges: ordering the options from best to worst based on a high-quality user model and partitioning the total set of options. While ordering and partitioning do not always improve choices separately, the authors use one field study and three experiments to identify the conditions that allow the combination to greatly improve health insurance decisions. Findings indicate that when options are ordered such that the best options appear at the beginning of the presented list, partitioning nudges consumers to focus on the best options. However, if the best options are not at the top of the list, partitioning discourages search and can impair consumers’ discovery of the best options. Process data shows that these effects are achieved by focusing consumers’ limited attention on higher quality options. These results suggest that wise choice architecture interventions need to consider the joint effect of choice architecture tools as well as the quality of the firm’s user model.

Special thanks to , Ph.D. candidate at Duke University, for support in working with authors on submissions to this program.

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