Brand equity is the differential preference and response to marketing effort that a product obtains because of its brand identification. Brand equity can be measured using either consumer perceptions or sales. Consumer-based brand equity (CBBE) measures what consumers think and feel about the brand, whereas sales-based brand equity (SBBE) is the brand intercept in a choice or market share model. This article studies the extent to which CBBE manifests itself in SBBE and marketing-mix response using ten years of IRI scanner and Brand Asset Valuator data for 290 brands spanning 25 packaged good categories. The authors uncover a fairly strong positive association of SBBE with three dimensions of CBBE—relevance, esteem, and knowledge—but a slight negative correspondence with the fourth dimension, energized differentiation. They also reveal new insights on the category characteristics that moderate the CBBE–SBBE relationship and document a more nuanced association of the CBBE dimensions with response to the major marketing-mix variables than heretofore assumed. The authors discuss implications for academic researchers who predict and test the impact of brand equity, for market researchers who measure it, and for marketers who want to translate their brand equity into marketplace success.
Abstract. Instead of purchasing individual content, streaming adopters rent access to libraries from which they can consume content at no additional cost. In this paper, we study how the adoption of music streaming affects listening behavior. Using a unique panel data set of individual consumers' listening histories across many digital music platforms, adoption of streaming leads to very large increases in the quantity and diversity of consumption in the first months after adoption. Although the effects attenuate over time, even after half a year, adopters play substantially more, and more diverse, music. Relative to music ownership, where experimentation is expensive, adoption of streaming increases new music discovery. While repeat listening to new music decreases, users' best discoveries have higher play rates. We discuss the implications for consumers and producers of music.
Many service firms acquire customers by offering free-trial promotions. However, a crucial challenge is to retain the customers acquired with these free trials. To address this challenge, firms need to understand how free-trial customers differ from regular customers in terms of their decisions to retain the service. This article conceptualizes how marketing communication and usage behavior drive customers’ retention decisions and develops hypotheses about the impact of free-trial acquisition on this process. To test the hypotheses, the authors model a customer's retention and usage decisions, distinguishing usage of a flat-rate service and usage of a pay-per-use service. The model allows for unobserved heterogeneity and corrects for selection effects and endogeneity. Using household panel data from a digital television service, the authors find systematic behavioral differences that cause the average customer lifetime value of free-trial customers to be 59% lower than that of regular customers. However, free-trial customers are more responsive to marketing communication and usage rates, which offers opportunities to target marketing efforts and enhance retention rates, customer lifetime value, and customer equity.
Today's consumers are immersed in a vast and complex array of networks. Each network features an interconnected mesh of people and firms, and now, with the rise of the Internet of Things (IoT), also objects. Technology (particularly mobile devices) enables such connections, and facilitates many kinds of interactions in these networks-from transactions, to social information sharing, to people interfacing with connected devices (e.g., wearable technology). We introduce the POP-framework, discuss how People, Objects and the Physical world interconnect with each other and how it results in an increasing amount of connected data, and briefly summarize existing knowledge on these inter-connections. We also provide an agenda for future research focused on examining potential impact of IoT and smart products on consumer behavior and firm strategies.
In this paper, we study how the adoption of music streaming affects listening behavior. Using a unique panel data set of individual consumers' listening histories across many digital music platforms, adoption of streaming leads to very large increases in the quantity and diversity of consumption in the first months after adoption. Although the effects attenuate over time, even after half a year, adopters play substantially more, and more diverse, music. Relative to music ownership, where experimentation is expensive, adoption of streaming increases new music discovery. While repeat listening to new music decreases, users' best discoveries have higher play rates. We discuss the implications for consumers and producers of music.History: Avi Goldfarb served as the senior editor and Catherine Tucker served as associate editor for this article.
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