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Exploding the Legend of Television Advertising and Price Promotions: The Proper Mix of Price, InStore, and TV for Maximum Short- and Long-Term ROI
Bill Harvey, Terese Herbig, Matthew Keylock, Ritesh Aggarwal and Nina Lerner, Journal of Advertising Research, Vol. 52, No. 3, 2012, pp. 339-345
The advertising and marketing communities traditionally have understood television advertising effectiveness and its relationship to in-store marketing tactics through small-market research or marketing-mix modeling.
The advertising and marketing communities traditionally have understood television advertising effectiveness and its relationship to in-store marketing tactics through small-market research or marketing-mix modeling. Although these studies have improved the quality of advertising-effectiveness research, they have done little to improve the tools marketers need to translate those insights on a larger scale and optimize their marketing allocations. With the proliferation of “big data,” researchers now have the ability to refine those tools and give marketers a more granular understanding of brand-purchase behavior and the impact of multiple marketing levers on in-store brand sales. This paper leverages the anonymous household-level purchase behavior data from 60 million households across the United States and the second-by-second measurement of television-viewing habits from more than 2 million set-top box households, and the current study applies actual (non-modeled) single-source, household-level data to demonstrate a methodology for optimizing the mix of television advertising and in-store marketing.
Little Moments of Luxury: How The Subconscious Seeks Out Satisfaction in Economically Distressed Times
A. K. Pradeep, ESOMAR, Innovate, Barcelona, November 2010
The brain processes the act of purchasing in the same region that it processes the experience of pain.
The brain processes the act of purchasing in the same region that it processes the experience of pain. It does in fact, from a brain science perspective, ‘hurt’ to hand over money in a transaction. At NeuroFocus, we have done a good deal of research into pricing, and the subconscious dynamics that we all undergo during the purchase decision process. We have uncovered a fascinating and unexpected phenomenon, “little moments of luxury”, which has led to the development of the Luxury Perceptual Framework.
Pricing Beyond the 'Homo Oeconomicus': Expensive Mistakes and Profitable Opportunities in Pricing Research
Florian Bauer, ESOMAR, Best Methodological Paper, Congress Odyssey, Athens, September 2010
Price optimisation is the most efficient lever to maximize profits but all classical price research tools fail to deliver optimal results as they still assume consumers to behave like a "Homo Oeconomicus".
Price optimisation is the most efficient lever to maximize profits but all classical price research tools fail to deliver optimal results as they still assume consumers to behave like a "Homo Oeconomicus". Using several examples we will highlight the shortcomings of classical tools like conjoint analysis or PSM and develop an open source pricing research framework – the "Psychological Price Profile" – that helps to broaden the research scope while still leveraging the advantages of the classical tools. Moreover, we will present the core results of a multi-national study involving 16 countries and 10 product categories.
Janus and the Changing Face of Pricing Research
Maureen Arink, Vicky Nef and Anne Favrelle, ESOMAR, Congress Odyssey, Athens, September 2010
Are you curious about how the economic crisis has influenced reactions to promotions? Do you wonder whether pricing is more important for shampoos or for diapers? Would you like to know how changing the size of a can of crisps works in relation to changing its price or how to better answer your clients' questions by leveraging the power of a database? Join us for this interactive session in which we will present our extensive data on price sensitivity (and assess the wisdom of the crowd by surveying our audience's beliefs about pricing in real time).
Are you curious about how the economic crisis has influenced reactions to promotions? Do you wonder whether pricing is more important for shampoos or for diapers? Would you like to know how changing the size of a can of crisps works in relation to changing its price or how to better answer your clients' questions by leveraging the power of a database? Join us for this interactive session in which we will present our extensive data on price sensitivity (and assess the wisdom of the crowd by surveying our audience's beliefs about pricing in real time). We will show how we have managed to connect the dots across different pricing studies and generate deep insight into consumer behavior towards pricing. We will also highlight commonly made assumptions about pricing and dispel them as myths - or confirm them as truths!
Generalizations about Advertising Effectiveness in Markets
Gerard J. Tellis, Journal of Advertising Research, Vol. 49, No. 2, June 2009, pp. 240-245
Based on over 260 estimates, the mean elasticity of sales or market share to advertising is 0.1 percent.
Based on over 260 estimates, the mean elasticity of sales or market share to advertising is 0.1 percent. Another 450 field experiments suggest that changes in media, product, target segments, advertising scheduling, and advertising content are more likely to yield changes in sales than do changes in advertising weight. Numerous other studies suggest that advertising wear-in does not exist or occurs quite rapidly while advertising wear-out occurs more slowly. Details of and differences in these results by condition are discussed in this article. From an issue of JAR devoted to `empirical generalisations’: the papers were first presented at a conference at the Wharton School, University of Pennsylvania in December 2008.
Exploring the price efficiency within automotive markets - An application of data envelopment analysis
Pingjun Jiang, International Journal of Market Research, Vol. 51, No. 3, 2009, pp. 403-426
Using a non-parametric data envelopment analysis (DEA) approach, this paper compares the price of each car model in a segment of the personal car market with the best possible price in view of the technology available given its particular combination of characteristics.
Using a non-parametric data envelopment analysis (DEA) approach, this paper compares the price of each car model in a segment of the personal car market with the best possible price in view of the technology available given its particular combination of characteristics. In this approach, a car model is defined as price efficient if it offers customers the highest value per dollar spent for that set of characteristics. Likewise, a car model is inefficient if there is some other car model with a lower price having equivalent or higher quality, whereby a measure of the price efficiency is determined by the price reduction needed to make a car model efficient. The data set covers 141 different year 2002 car models. The vehicles that are listed by Edmunds.com as consumers’ most wanted are compared with those at the top of our efficiency list. It is found that the majority of cars at the top of the list are also listed as most wanted by Edmunds.com. Evidently, consumers who usually make decisions based on price and quality information will naturally employ a heuristic such as ‘buy car models at the top of price efficiency list’ if this list is made available to them.
Using Support Vector Semiparametric Regression to estimate the effects of pricing on brand substitution
María Pilar Martinez-Ruiz, Alejandro Mollá-Descals, Miguel Ángel Gómez-Borja and José Luis Rojo-Álvarez, International Journal of Market Research, Vol. 50, No. 4, 2008, pp. 533-557
This paper analyses the sales impact of temporary retail price discount on consumer goods product categories with different perishability rates, and provides some empirical findings regarding how the deal discounts of competing brands affect the sales substitution effects among them.
This paper analyses the sales impact of temporary retail price discount on consumer goods product categories with different perishability rates, and provides some empirical findings regarding how the deal discounts of competing brands affect the sales substitution effects among them. We focus on the cross-price effects by considering both the asymmetric cross-price effect and the neighborhood crossprice effect. To test these effects we use Support Vector Machine-Semiparametric Regression (SVM-SR) and we highlight the benefits of this methodology on the study of promotional effects with aggregate scanner data. The empirical findings confirm the existence of cross-promotional effects of different magnitude, depending on the considered category. In addition, other significant promotional effects are evidenced, such as saturation levels - especially in the lower-priced brands of the categories - and a higher weekend sales acceleration effect in the storable category. Our conclusions are of key relevance for retail managers, since developing a superior knowledge on sales substitution effects within the categories carried is critical for designing and developing better pricing, promotional, and category management schemes.
Retaining after sales business at the branded automotive dealership
Jürgen Verlee and Dick Hage, ESOMAR, Automotive Conference, Lausanne, March 2008
In many national economies, the automotive business plays a major role - in Germany, for instance, 10% of the working population is in some way connected to the automotive industry.
In many national economies, the automotive business plays a major role - in Germany, for instance, 10% of the working population is in some way connected to the automotive industry. In automotive retailing the impressive turnover of automotive dealerships makes them one of the most important players in local economic areas. In the Netherlands, the top 50 automotive dealers sell more than 40% of all the 500,000 new cars entering the market in a year. Although the turnover on selling new cars is high, the profit margin is quite low, 1 or 2% at the most, comparable to food retailing. Continuous investments need to be done to keep automotive dealerships modern and up to date, thus somewhere money has to be made. In general 65% of the revenue in automotive retailing at Toyota dealerships in the Netherlands comes from the After Sales business.
Algebra, slide rules and hammers: a mobile telecoms segmentation
Nick Bonney and Jonathan Fletcher, ESOMAR, Annual Congress, Berlin, September 2007
This paper describes the experience of developing Orange's European mobile consumer segmentation and applying it to the UK market.
This paper describes the experience of developing Orange's European mobile consumer segmentation and applying it to the UK market. The process started in 2003 with a major study in Orange's six main European markets. In 2006 the segmentation was fully operationalised in the UK and formed the basis of Orange UK's highly successful Animal tariffs campaign. The main learnings from this process are highlighted, showing how research provided a sound platform for the segmentation at the outset and kept the implementation process on track when initial setbacks threatened to derail it.
Pushing the right buttons - how can we develop the optimal pricing strategy?
Jürgen Warnecke, Dirk Huisman and Sander Noorman, ESOMAR, Telecoms Conference, Barcelona, November 2006
In the competitive mobile telecom market combining price reductions with increasing revenues is of high importance.
In the competitive mobile telecom market combining price reductions with increasing revenues is of high importance. KPN Mobile and SKIM Analytical have conducted several studies in order to identify key drivers of choice, also taking into account the importance of brand image. This paper describes how the key drivers can be identified and how brand re-positioning, in conjunction with targeted pricing strategies, enabled KPN to turn a declining trend and to capitalise on its dual branding strategy.
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