There is no question that the Internet has, and will continue to have, a major impact on consumer information search behavior. However, under what conditions, and how, that impact will be felt is not clear. For many pundits and politicians, the Internet represents the ultimate consumer panacea. Indeed, the hubris surrounding the alleged benefits that the Internet offers consumers is unprecedented. Foremost among these alleged benefits are the quantity and quality of individually customized information that the Internet can provide with minimal effort and cost, information that facilitates better decision making and makes the decision-making process more efficient (e.g., Alba, Lynch, Weitz,
As more firms adopt a customer asset management approach to their business, it has become increasingly important to understand how customer management efforts relate to the financial performance of the firm. Of specific interest to shareholders is the relationship between traditional financial measures and customer-centric measures. The customer-centric measure that has received the most attention is customer lifetime value (CLV). In this article, the authors argue that the basic CLV model represents a useful foundation from which to begin to fill the gap between marketing actions and shareholder value. However, much work remains to be done before appropriate models can be developed that reflect the true value of a customer to the firm. Specifically, this article elaborates on how factors such as risk associated with customer behavior dynamics, social and competitive effects, and the effect of the product life cycle can be incorporated into the basic CLV model.
Purpose -This study set out to measure the perceived Advertising Value of Twitter ads on a large sample of Mexican Millennials.Design/methodology/approach -An online survey was used to collect data among 630 university students. The hypothesized antecedents of Advertising Value were Informativeness, Entertainment, Irritation and Credibility. The model was estimated using Partial Least Squares.Findings -Results indicate Informativeness and Entertainment were the strongest predictors, with Credibility in third place. In addition, Credibility displayed gender effects: it was significant for female respondents but not for males. Irritation failed to reach statistical significance in most subsamples, suggesting Twitter ads are more acceptable to Millennials than other advertising formats.Originality/value -Millennials tend to dismiss traditional advertising formats. At the same time they are heavy users of Social Networking Sites. This research provides the first empirical estimation of the Ducoffe model of Advertising Value in the microblogging service Twitter, and the first application of this robust model of web advertising to a Latin American sample. Our results have important implications for both regional and global brands targeting Millennials.
Purpose The purpose of this paper is to document the extensive heterogeneity in institutions within countries and investigate which institutional factors are the most relevant for international brands. Design/methodology/approach The paper analyzes the entry patterns of three global fast-food franchise networks in 78 Mexican cities using discrete outcome models and ordered probit in particular. To summarize the quantitative importance of the results, the analysis includes also log-linear regressions with Heckman correction for the city observations without franchise presence. Findings Institutional factors are critical for an international franchisor in the decision to enter a new market. The most important institutional quality proxy for franchise entry is the rate of formal employment. The more the informal employment in a city, the lower the number of franchised stores and the lower the probability of brand presence in the city. Research limitations/implications Only three fast-food franchises are included in the paper, which limits the generalization of the results beyond the sector and Mexico. Another limitation of the methodology of this paper is that the authors estimate the effect of institutions on multinational franchise entry conditioning on market size. The issue here is that if institutions increase gross domestic product (GDP) per capita, then the demand for multinational franchises also increases. Such an effect cannot be captured if we condition on market size in our econometric models. This is particularly important for policy-makers aiming to quantify costs and benefits of reforms but not an important consideration for practitioners who might take institutions as given and are mainly interested in entry strategies that maximize profitability. Practical implications Institutional variables, and not only market factors, are critical to understand the entry decision of global franchisors in Mexico. In particular, the extent of informality is relevant in explaining the store location. It is necessary to understand how managers value the quality of institutions and which dimensions are most important for multinationals. In addition, the analysis should be conducted both at the national and sub-national level, given that within-country heterogeneity is prevalent in emerging markets. Social implications Cities must reinforce and communicate their institutional quality to attract foreign investment by franchises in particular. Originality/value We test several dimensions of institutional quality at the urban level as determinants of multinationals? decision to enter a city in a foreign market. We use novel administrative data at the municipality level and we employ econometric model that takes into account the discreetness of entry data and the fact that there are cities with no franchise presence. We control for sample selection, which comes from the zero number of stores in some city observations in the regressions.
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