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Article
Publication date: 25 September 2020

Kashef A. Majid

The cost of customer acquisition is one of the largest expenses that service firms incur due to loss-generating quotes/proposals. This paper aims to connect interactive marketing…

2857

Abstract

Purpose

The cost of customer acquisition is one of the largest expenses that service firms incur due to loss-generating quotes/proposals. This paper aims to connect interactive marketing communications channels with increased customer acquisition and non-interactive marketing communications channels with decreased customer acquisition by service firms.

Design/methodology/approach

Two field studies using hazard models were used to assess the probability of acquiring a new customer after the prospect first contacts the firm. Multiple discrete hazard models were used to compare channels against each other.

Findings

Three interactive marketing communications channels (word-of-mouth, online review forum, search engine optimization) increased the rate of acquiring a customer over time. I also compared non-interactive channels (billboard/signage, direct mail), but the analysis did not reveal any significant impact on acquisition rate by the non-interactive marketing communications channels.

Originality/value

The present study illustrates why the cost of acquisition is so high in the service sector and takes the unique step of linking interactive marketing communications channels with higher customer acquisition rates over time in a services context. Specifically, interactive marketing channels enable customers to find firms that offer the attributes that they seek, thereby increasing acquisition probabilities and decreasing acquisition costs.

Details

Journal of Services Marketing, vol. 35 no. 3
Type: Research Article
ISSN: 0887-6045

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Article
Publication date: 8 April 2021

Kashef A. Majid, David W. Kolar and Michel Laroche

Crises threaten the operations of small businesses and endanger their survival; however, when the crisis is not attributable to the firm, consumers may rally around the business…

692

Abstract

Purpose

Crises threaten the operations of small businesses and endanger their survival; however, when the crisis is not attributable to the firm, consumers may rally around the business. This study aims to examine how attitudes toward helping others can create support for small businesses, which in turn can direct consumers to help businesses with increased financial support. It is hoped that this paper will inform how consumers will help firms pivot during crises.

Design/methodology/approach

A conceptual model was proposed which linked support for helping others to increased willingness to tip/amount tipped. The model was tested using structural equation modeling from two surveys given to customers of two small businesses, a coffee shop and an independent movie theater, respectively.

Findings

During a crisis, support for helping others has a positive impact on feelings of support for small businesses. Consumers direct their support to small businesses that they are interested in seeing survive and continue operations. They either tip more or tip when they otherwise would not have tipped.

Practical implications

Firms that pivot their operations because of a crisis imposed on them can still generate revenues. Consumers who have a self-interest in the continuing operations of the firm want to support it, and by pivoting their business model, the firm gives consumers the opportunity to give the firm and its employees more than they would have in the form of tips.

Originality/value

Prior work in crisis management has focused primarily on how firms recover and respond to a crisis of their doing. Overwhelmingly, consumers have been shown to punish firms during times of crisis. However, for a crisis that is imposed on the firm, consumers may rally behind the firm and respond by supporting it more than they are required to.

Details

Journal of Services Marketing, vol. 35 no. 5
Type: Research Article
ISSN: 0887-6045

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Article
Publication date: 10 April 2017

Kashef A. Majid

The purpose of this paper is to explore how a positive country-of-origin image will impact consumer perceptions for a high-risk product when the price is unexpectedly low.

807

Abstract

Purpose

The purpose of this paper is to explore how a positive country-of-origin image will impact consumer perceptions for a high-risk product when the price is unexpectedly low.

Design/methodology/approach

An experimental approach was used with consumers from the USA and India. Consumers were divided into groups and given two scenarios that involved purchasing medicine that may have been counterfeit. In one scenario manufacturing took place in India, the other in Switzerland. They were asked to state the probability that certain goods could be counterfeit if they originated from the stated country and then make choices based on those perceived probabilities. An analysis of variance was conducted to test for differences between groups.

Findings

The authors found that in both samples consumers attached greater probabilities toward low-priced medicines if they originated from Switzerland vs India. Conversely, the higher priced medicines were more likely to be counterfeit if they originated from India vs Switzerland. When given a choice scenario consumers chose more versions of the cheaper products from India than from Switzerland.

Originality/value

When country-of-origin is salient then it is believed that a positive country-of-origin image will benefit products that are produced from that country. Consumers expect that more expensive products come from a country with a positive country-of-origin image. The results demonstrate that when there is a conflict between expectations of the country and the price of the product the outcome is lowered perceptions and consumption of the product. This holds true for consumers from a high-cost economy (USA) and consumers from a low-cost economy (India). The authors add to the literature on country-of-origin by demonstrating that a positive image can be a liability when consumers are wary of purchasing a high-risk product.

Details

International Marketing Review, vol. 34 no. 2
Type: Research Article
ISSN: 0265-1335

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Article
Publication date: 19 June 2018

Kashef A. Majid and Hari Bapuji

The purpose of this paper is to examine how the location of a firm’s headquarters and component sourcing impact a firm’s responsiveness in a product-harm crisis in local market.

661

Abstract

Purpose

The purpose of this paper is to examine how the location of a firm’s headquarters and component sourcing impact a firm’s responsiveness in a product-harm crisis in local market.

Design/methodology/approach

The authors collected data on 1,251 vehicle recalls from 12 manufacturers, six in the USA, three in Germany, and three in Japan. All of the recalls occurred in the USA between 2002 and 2010. The time the product was first released into the marketplace was used as the starting point while the time the recall was initiated (if at all) was used to record the probability of the product recall over time. Specifically, a survival analysis with an accelerated failure time model was employed to examine the speed with which a product is recalled. The authors examined the impact of foreign composition using information provided by the American Automobile Labeling Act, which lists the proportion of each vehicle that is composed of domestic parts (USA/Canada) and foreign parts. Organizational characteristics (i.e. size, market share, assets, net income, and reputation) and recall size (i.e. number of affected vehicles) that might have an effect on time to recall were controlled for.

Findings

The authors found that firms headquartered outside the local market would take longer to issue a product recall than firms that were headquartered in the local market. Firm headquartered outside the local market can reduce the time taken to recall by sourcing parts from the local marketplace, rather than from abroad. Interestingly, even local firms are affected by the location of component sourcing, such that they take longer to issue a recall if they sourced parts from abroad.

Originality/value

Research in international marketing has examined the benefits of integration to firms, but has not studied the risks of integration. By highlighting the challenges of managing institutional differences and integration difficulties, the authors show that location of headquarters and the location from where components are sourced have an effect on firm responsiveness in product-harm crises. Further, the authors build on the global supply chain management literature that has shown the effect of upstream activities (i.e. foreign production) on downstream activities (i.e. product quality). Specifically, the authors show that upstream activities can not only affect product quality, but also the ability of firms to respond to those product qualities in a timely fashion.

Details

International Marketing Review, vol. 35 no. 5
Type: Research Article
ISSN: 0265-1335

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Article
Publication date: 9 September 2014

Kashef A. Majid, Andrew Bryant and Pradeep A. Rau

This paper aims to investigate the presence of varying price points on the impact of product valuations in both English and reverse auctions on potential bidders, that is, those…

2763

Abstract

Purpose

This paper aims to investigate the presence of varying price points on the impact of product valuations in both English and reverse auctions on potential bidders, that is, those not yet engaged in the auction. Internet auctions, both English style and reverse, constitute one of the success stories of digital commerce.

Design/methodology/approach

As its method of research, this paper uses an experimental approach to explore the effects of multiple reference prices.

Findings

While previous research has done well to show that a lower initial price decreases barriers to entry and can lead to a higher final price in English-style auctions, this research shows that such a strategy may harm potential bidders’ product perceptions due to multiple reference prices. The authors explore situations of multiple reference prices in the context of reverse auctions, where both higher and lower reference prices are shown to be able to increase product valuations.

Research limitations/implications

Additional research of a variety of products and using a representative sample would enhance the findings of this paper.

Practical implications

The findings show that reference prices have differing impacts, which are dependent upon the goal of either maximizing or minimizing the distance between the initial price and the price consumers are willing to pay in an online auction.

Originality/value

The investigation links differing goals created by the type of auction to the potential impact of the reference price. In addition, we explore the effects of multiple reference prices on consumer valuations.

Details

Journal of Product & Brand Management, vol. 23 no. 6
Type: Research Article
ISSN: 1061-0421

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Article
Publication date: 3 May 2018

Kashef Majid and Mooweon Rhee

The purpose of this paper is to identify the rate of recall for new products vs established products and to explore the simultaneous impact of a firm’s reputation and a product’s…

612

Abstract

Purpose

The purpose of this paper is to identify the rate of recall for new products vs established products and to explore the simultaneous impact of a firm’s reputation and a product’s reputation on the market response to a product recall.

Design/methodology/approach

The authors first use an accelerated hazard model to establish that new products are more vulnerable to damage than established products. Once this is established, the authors use a hierarchical linear model to explore the simultaneous impact of the firm and product reputation on the market response to a product recall.

Findings

The findings indicate that new products have a greater probability of recall over time than existing products and after a product recall a positive firm reputation can negatively impact the firm and hence becomes a liability. However, when the product is first introduced, the product reputation can help offset any negative market response; the product reputation can therefore be an asset.

Research limitations/implications

New products are more flawed than their established counterparts. A positive reputation can be a liability but a positive product reputation can offset the negative impact of the firm reputation and this is especially pertinent to new products.

Originality/value

The majority of prior research has focused on the reputation and assumed that the firm represented the product as well; the findings of this study reveal that the reputation of the product can have contrasting effects to the reputation of the firm.

Details

Marketing Intelligence & Planning, vol. 36 no. 5
Type: Research Article
ISSN: 0263-4503

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