http://repub.eur.nl/res/concept/jel-M31/ Recent publications classified by JEL Code M31 en http://repub.eur.nl/static-eur/img/logo.png http://repub.eur.nl http://repub.eur.nl/res/pub/39958/ 2013-05-08T00:00:00Z In this paper we propose the use of preferred outcome distributions as a new method to elicit individuals’ value and probability weighting functions in decisions under risk. Extant approaches for the elicitation of these two key ingredients of individuals’ risk attitude typically rely on a long, chained sequence of lottery choices. In contrast, preferred outcome distributions can be elicited through an intuitive graphical interface, and, as we show, the information contained in two preferred outcome distributions is sufficient to identify non-parametrically both the value function and the probability weighting function in rank-dependent utility models. To illustrate our method and its advantages, we run an incentive-compatible lab study in which participants use a simple graphical interface – the Distribution Builder (Goldstein et al. 2008) – to construct their preferred outcome distributions, subject to a budget constraint. Results show that estimates of the value function are in line with previous research but that probability weighting biases are diminished, thus favoring our proposed approach based on preferred outcome distributions. Donkers, A.C.D. Lourenço, C.J.S. Dellaert, B.G.C. Goldstein, D.G. http://repub.eur.nl/res/pub/39630/ 2013-04-15T00:00:00Z Consumer embarrassment is an important concern for marketers. Yet, little is known about embarrassment in passive situations like advertising viewing. The authors investigate when and why consumers experience embarrassment as a result of exposure to socially sensitive advertisements. The theory distinguishes between viewing potentially embarrassing ads together with an audience that shares the social identity targeted by the message and viewing the same ads together with an audience that does not share the targeted social identity. Four studies provide support for the theory, demonstrating that advertising targeting and social context jointly determine feelings of embarrassment and advertising effectiveness. Puntoni, S. Hooge, I.E. de Verbeke, W.J.M.I. http://repub.eur.nl/res/pub/38213/ 2012-11-30T00:00:00Z A Forecast Support System (FSS), which generates sales forecasts, is a sophisticated business analytical tool that can help to improve targeted business decisions. Many companies use such a tool, although at the same time they may allow managers to quote their own forecasts. These sales forecasters (managers) can take the FSS output as their input, but they can also fully ignore the FSS out- comes. We propose a methodology that allows to evaluate the forecast accuracy of these managers, relative to the FSS, while taking aboard latent variation across managers' behavior. We show that the results, here for a large Germany-based pharmaceutical company, can in fact be used to manage the sales forecasters by giving clear-cut recommendations for improvement. Bruijn, B. de Franses, Ph.H.B.F. http://repub.eur.nl/res/pub/31571/ 2011-11-01T00:00:00Z Customer‐centric strategy firms need to focus on forward‐looking indicators and ensure a synergistic relationship between decision rights, performance measurement, and reward systems. Bonacchi, M. Perego, P.M. http://repub.eur.nl/res/pub/23670/ 2011-06-30T00:00:00Z The rise of consumerism and the increasing availability of information through the Internet have increased patients’ demand for care that is more in line with their preferences. Because of this trend the expectation that hospitals act according to each individual patient’s preferences is becoming even more prominent. Hospitals could respond by implementing flexible health care policies that offer patients more choice. In this dissertation we explore two types of flexible health care policies from the consumer perspective: priority access pricing and customized care. We do this by (1) investigating how consumers evaluate price-based priority access allocation policies (i.e., allocation policies in which patients are offered the option to pay extra for faster health care access), and by (2) demonstrating how the collective costs and benefits of customized health care policies (i.e., policies that offer individuals the possibility to “create” their own health care program) can be used to evaluate customized care. Throughout, special attention is given to the role of collective health outcomes. Besides our scientific conclusions, our findings are also relevant for hospitals and policy makers that consider implementing new allocation policies. They can be used to provide assistance in future health care decision making. Benning, T.M. http://repub.eur.nl/res/pub/23604/ 2011-06-24T00:00:00Z In this dissertation, I focus on physician and patient behavior. I model patient and physician decisions by integrating robust insights from different behavioral sciences (e.g. economics, psychology and sociology) in econometric models calibrated on individual data. This approach allows me to bring novel insights for managers, policy-makers and patients about: (1) how physicians learn from patient feedback about a new drug (in particular, how switching patients are 7 to 10 times more salient, in physicians' memory, than patients who refill their medication), (2) the relationship between patient empowerment and patient non-adherence to physician advice (in particular, the importance of going beyond the logic of self-determination theory, which predicts that empowering patients in the medical encounter is always beneficial, and consider side effects like patient overconfidence which, in the case of therapy adherence, actually make patient empowerment undesirable), and (3) the main drivers of patient drug requests by brand name and the physician’s accommodation of such requests (in particular, comparing the importance of health information obtained via mass-media, word-of-mouth from expert consumers, word-of-mouth from other consumers and patient values). Camacho, N.M.A. http://repub.eur.nl/res/pub/23610/ 2011-06-24T00:00:00Z Pharmaceutical marketing effectiveness comprises the measurement of marketing efforts of pharmaceutical firms towards doctors and patients. These firms spend billions of dollars yearly to promote their prescription drugs. This dissertation provides empirical analyses and methods to contribute to several substantial problems on pharmaceutical marketing effectiveness. Using unique data in every essay, it studies the role of the firm, sales rep and doctor in pharmaceutical marketing. The first essay evaluates the size of the sales force and the allocation of sales calls among doctors. In particular, it provides a method to gauge a yet-to-be-enacted firm-initiated policy shift. The second essay studies the effectiveness of the information content provided in sales calls. The main questions evolve around the discussion of positively biased drug information and the responsiveness of doctors to that. In the third essay, the interplay between drug sales, marketing and scientific reviews is studied in detail. The essays reveal important implications for academics and managers. For academics: (i) a new alternative to gauge policy shifts is offered; (ii) a model is offered to analyze the effectiveness of sales message content; and (iii) scientific reviews should be considered to correctly measure pharmaceutical marketing effectiveness. The implications for managers are: (i) the market leader is able to buck the trend in increasing sales forces; (ii) sales reps discuss positively biased information too often, which is counterproductive in the long run; and (iii) scientific reviews on products should be actively considered as a part of the marketing mix. Kappe, E.R. http://repub.eur.nl/res/pub/23504/ 2011-06-10T00:00:00Z The ability to learn about the relation or covariation between events happening in the world is probably the most critical aspect of human cognition. This dissertation examines how the human mind learns numerical and emotional relations and explores consequences for managerial and consumer decision making. First, we study how uncertainty in the environment affects covariation learning and explore the consequences for consumers’ price-quality inferences and product valuation. Second, we examine how different types of accountability (process versus outcome) and analytical intelligence affect learning and judgment. We highlight the implications for employee performance management. Third, building on associative models of memory, we show that bilingual consumers perceive advertising messages in their native language (L1) to be more emotionally intense than advertising messages in their second language (L2). Finally, we explore the consequences of a greater perceived emotionality in L1 for international marketing research. The practical implications of this dissertation are of interest for professionals working in the area of pricing, branding, marketing research, and human resources. From a theoretical point of view, this dissertation relates to the fields of judgment and decision making under uncertainty and cognitive psychology. Langhe, B. de http://repub.eur.nl/res/pub/23641/ 2011-06-01T00:00:00Z Breast cancer communications that make women's gender identity salient can trigger defense mechanisms and thereby interfere with key objectives of breast cancer campaigns. In a series of experiments, the authors demonstrate that increased gender identity salience lowered women's perceived vulnerability to breast cancer (Experiments 1a, 3a, and 3b), reduced their donations to ovarian cancer research (Experiment 1b), made breast cancer advertisements more difficult to process (Experiment 2a), and decreased ad memory (Experiment 2b). These results are contrary to the predictions of several prominent theoretical perspectives and a convenience sample of practitioners. The reduction in perceived vulnerability to breast cancer following gender identity primes can be eliminated by self-affirmation (Experiment 3a) and fear voicing (Experiment 3b), corroborating the hypothesis that these effects are driven by unconscious defense mechanisms Puntoni, S. Sweldens, S.T.L.R. Tavassoli, N.T. http://repub.eur.nl/res/pub/23489/ 2011-05-13T00:00:00Z Considerable attention has been paid to the network determinants of knowledge sharing. However, most, if not all, of the studies investigating the determinants of knowledge sharing are either focused on knowledge-intensive organizations such as consultancy firms or R&D organizations, or knowledge workers in regular organizations, while lesser knowledge intensive organizations or non-knowledge workers are rarely explored. This is a gap in the literature on social networks and knowledge sharing. In this paper, the relations between network determinants and actor determinants of knowledge sharing are empirically tested by means of a network survey in a less knowledge intensive organization, specifically employees of a Dutch department store chain. The results show that individual-level variables such as departmental commitment and enjoyment in helping others are the major determinants of individuals’ knowledge sharing behavior, but none of the social network variables play a role. The results thus present an important boundary condition to social networks effects on knowledge sharing: social networks only seem to play a role in knowledge sharing for knowledge workers, not for blue-collar workers. Capellen, van der J. Koppius, O.R. Dittrich, K. http://repub.eur.nl/res/pub/23488/ 2011-05-03T00:00:00Z Research on the launch of new products in the international realm is scarce. The present paper is the first to document how launch window (difference in months between the first worldwide launch and the subsequent launch in a specific country) and launch price are interrelated and how regulation influences both launch window and launch price. The research context is the global - 50 countries worldwide - launch of 58 new ethical drugs across 29 therapeutic areas. We show that the fastest launch occurs when the launch price is moderately high and the highest launch price occurs at a launch window of 85 months. We find that the health regulator acts strategically in that the extent to which it delays the launch of a new drug increases with the price of the new drug. We also find that regulation overall increases the launch window, except for patent protection. Surprisingly, regulation does not directly impact launch price. The descriptive information on average launch window and launch price and the interconnection between launch window and launch price allows managers in ethical drug companies to build more informed decisions for international market entry. This study also provides public policy analysts with more quantitative evidence regarding launch window and launch price on a broad sample of countries and categories. Verniers, I.W.J. Stremersch, S. Croux, C. http://repub.eur.nl/res/pub/22977/ 2011-04-14T00:00:00Z Questionnaires are an important way to gather information about large populations for both qualitative and quantitative research. Hence, the value of a good questionnaire design and the quality of questionnaire data cannot be emphasized enough. This thesis discusses some aspects of the statistical analysis of measurement data obtained via questionnaires. In the first part of this thesis we focus on maximizing scale reliability. We derive the asymptotic distribution of maximal reliability measures to construct confidence intervals in order to assess the adequacy of the measure. We stress the use of confidence intervals accompanying single measures that summarize the parameters to assess the adequacy of the measure. The results can lead to better designs of questionnaires, which in turn lead to more precise survey outcomes. The second part of this thesis proposes methodologies to perform statistical analysis of stated consumer preferences measured as rankings data, especially in the context of conjoint measurements. Our statistical models allow for the efficient use of partial rankings to collect preference data. As a partial rankings task amount to a smaller burden for respondents than a complete ranking task, they may be more motivated to complete the task and as such the quality of the obtained data may improve. Moreover, we show that our model is able to extract sufficient preference information from partial rankings data to take into account respondents' heterogeneity in their choice and preference behavior, which is generally assumed in marketing. This certainly will help marketers to identify and target consumers by understanding their preference behavior, and to implement a more efficient and optimal marketing strategy. Lam, K.Y. http://repub.eur.nl/res/pub/22813/ 2011-03-21T00:00:00Z While the number and importance of joint innovation projects between suppliers and their customers continue to rise, the literature has yet to resolve a key question—do embedded ties with customers help or hurt supplier innovation? Drawing on both the tie strength and knowledge literatures, we theorize that embedded ties interact with supplier and customer innovation knowledge to influence supplier innovation. In a sample of 157 Dutch business-to-business innovation relationships, we observe that embedded ties weaken how much suppliers benefit from customer innovation knowledge due to worries about customer opportunism (the dark side of embedded ties). However, we uncover three moderating relationship and governance features that allow suppliers to overcome these dark-side effects and even increase innovation (the bright side of embedded ties). Finally, although we predicted a bright-side effect, we find that embedded ties neither help nor hurt the supplier to leverage its own innovation knowledge in the relationship. Noordhoff, C.S. Kyriakopoulos, K. Moorman, C. Pauwels, P. Dellaert, B.G.C. http://repub.eur.nl/res/pub/22725/ 2011-03-11T00:00:00Z Nonmetric unfolding is a powerful (nonparametric) analytical tool generating a preference-based joint display of subjects (e.g., customers) and objects (e.g., brands or products). Systematic patterns in customers’ preferences can be directly inferred from this display, and may provide valuable input for making important marketing decisions such as deciding what new product to launch. Unfortunately, nonmetric unfolding frequently produces degenerate unfolding solutions (i.e., unfolding solutions showing close-to-perfect model fit irrespective of the data analyzed). As a degenerated display shows ill-positioned customers and brands/products, the chance of making an incorrect marketing decision (e.g., launching the wrong product) is very high. To solve this problem adequately, we combine bootstrapping with penalized nonmetric unfolding (Prefscal) to obtain an accurate, nondegenerate and stable unfolding solution. Velden, M. van de Beuckelaer, De A. Groenen, P.J.F. Busing, F.M.T.A. http://repub.eur.nl/res/pub/23453/ 2011-03-01T00:00:00Z Interactive decision aids (IDAs) typically use concrete, feature–based approaches to interact with consumers. Recently, however, interaction designs that focus on communicating abstract consumer needs have been suggested as a promising alternative. This paper investigates how temporal distance moderates the effectiveness of these two competing IDA communication designs by its effect on consumers’ mental representation of the product decision problem. Temporal distance is inherently connected to IDAs in two ways. Congruency between consumption timing (immediate versus distant) and IDA communication design (concrete versus abstract, respectively) increases the likelihood to accept the IDA’s advice. This effect is also achieved by congruency between IDA process timing (immediate versus delayed delivery of recommendations) and IDA communication design (concrete versus abstract, respectively). We further show that this process is mediated by the perceived transparency of the IDA process. Managers and researchers need to take into account the importance of congruency between the user and the interface through which companies interact with their users and can further optimize IDAs so that they better match consumers’ mental representations. Kohler, C.F. Breugelmans, E. Dellaert, B.G.C. http://repub.eur.nl/res/pub/22614/ 2010-12-15T00:00:00Z We examine the situation where hourly data are available to design advertising-response models, whereas managerial decision making can concern hourly, daily or weekly intervals. The key question is how models for hourly data compare to models based on weekly data with respect to forecasting accuracy and with respect to assessing advertising impact. Simulation experiments suggest that the strategy, which entails modeling the least aggregated data and forecasting more aggregate data, yields better forecasts, provided that one has a correct model specification for the higher frequency data. A detailed analysis of three actual data sets confirms this conclusion. A key feature of this confirmation is that aggregation affects data transformation to dampen the variance. The estimated advertising impact is sensitive to the appropriate transformation. Our conclusion is that disaggregated models are preferable also when decision have to be made at lower frequencies. Kiygi Calli, M. Weverbergh, M. Franses, Ph.H.B.F. http://repub.eur.nl/res/pub/21580/ 2010-11-30T00:00:00Z In word of mouth, consumers talk about their experiences with products and services with other consumers. These conversations are important sources of information for consumers. While word of mouth has fascinated researchers and practitioners for many years, little attention has been paid to the question of how consumers talk about products and brands, and whether and how this moderates the extent to which they influence other consumers. This dissertation fills this gap, and focuses on the language that consumers use when they describe their experiences. For example, if your brand new shirt lost its color after one or two washes, you could say to your friend “My shirt has faded,” or you could say “My shirt was of poor quality”. In the former case, you provide a very concrete description of what has happened. In the latter, you use more abstract wording, which generalizes this single experience to an overall impression of the shirt’s quality. This dissertation focuses on language abstraction, because abstractness is an important aspect of language, and it can be coded unambiguously and relatively easily. A series of experiments examined when and why consumers use abstract versus concrete language in word of mouth, and how these differences in language use affect the receiver of the word-of-mouth message. Among other things, the results show that consumers use more abstract language when they describe expriences that are in line with their prior opinions about a product, and that more abstract descriptions generally have a larger impact on other consumers. Schellekens, G.A.C. http://repub.eur.nl/res/pub/21188/ 2010-11-11T00:00:00Z Identifying the drivers of salespeople’s performance, strategies and moral behavior have been under the scrutiny of marketing scholars for many years. The functioning of the drivers of salespeople’s behaviors rests on processes going on in the minds of salespeople. However, research to date has used methods based only on verbal self-reports. Advances in techniques from neuroscience such as functional Magnetic Resonance Imaging (fMRI) suggest that despite their complexity and relative inaccessibility, mental processes can be measured more directly. Theory of Mind and mirror neurons are two mechanisms that operate at an automatic or reflexive level, and are important drivers of social intelligence. We use fMRI and field studies to investigate how individual differences in de functioning of these social intelligence mechanisms relate to the job performance and ethical orientations of salespeople. In addition, we use fMRI to analyse the psychometric properties of scales. Our results show that when salespeople are presented with social stimuli during fMRI, they display individual differences in the amount of neurological processing in regions that play key roles in social intelligence, and these individual differences show associations with salespeople’s performance, strategy and ethical orientations. Implications for training, selection & recruitment of salespeople are provided. The theoretical contributions relate to the field of Marketing, Social Neuroscience, and Personality. Dietvorst, R.C. http://repub.eur.nl/res/pub/21186/ 2010-11-05T00:00:00Z In this dissertation, I empirically examine system markets up close. More specifically I examine indirect network effects, both demand-side and supply-side indirect network effects. Indirect network effects are the source of positive feedback in system markets, or so network effect theory tells us. Systems are composed of complementary and interdependent products, such as hardware and software. For instance, a video game system is composed of the video game console, on the one hand, and video games, on the other hand. Surprisingly, I find that the positive feedback cycle of indirect network effects is less pervasive, or at least more complex, than “current wisdom” would have us believe. Supply-side and/or demand-side indirect network effects, as traditionally operationalized, are often not present. When present, they display strong heterogeneity. There is often no positive feedback cycle present in the initial stage of the system’s life cycle. Software quantity is of little importance, while software products of exceptional high quality (i.e., superstars) play an important role. Our empirical studies identify numerous factors marketing manager can manipulate to influence the positive feedback cycle. Subsequently marketing managers can incorporate our findings in their marketing strategy, and outmaneuver competitors (i.e., competing systems, fellow complementors). Binken, J.L.G. http://repub.eur.nl/res/pub/21149/ 2010-11-04T00:00:00Z Using advice in decision making is widespread for all sorts of important personal and professional decisions. Yet, traditional research on individual decision making has failed to systematically study the impact that social interactions about a decision problem can have on the decision outcome. A separate literature stream about advice giving and taking emerged in the 1980s in order to model a decision making structure where one person is responsible for the final decision, but seeks advice from one or more other persons as input in the decision making process. To date, a breadth of research questions have been addressed in order to gradually develop a theory of advice taking. This dissertation is a bundle of three empirical papers on advice taking in marketing that each studies a specific topic within the advice taking domain. Using similar experimental methodologies, the papers bundled in this thesis all find and discuss variable utilization of advice based on the manipulation of one element in the advice situation: advisor wealth, advice justification, and emotions experienced by the decision maker. As such, each of the papers offers some interesting managerial implications and contributes to the development of a more comprehensive theory of advice taking in its own right. Tzioti, S.C.