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Befriending the Enemy: The Effects of Observing Brand-to-Brand Praise on Consumer Evaluations and Choices
Lingrui Zhou, Katherine Du & Keisha Cutright
Journal of Marketing, forthcoming
Abstract:
Consumers have grown increasingly skeptical of brands, leaving managers in a dire search for novel ways to connect. The authors suggest that focusing on one's relationships with competitors is a valuable, albeit unexpected, way for brands to do so. More specifically, the present research demonstrates that praising one's competitor -- via "brand-to-brand praise" -- often heightens preference for the praiser more so than other common forms of communication, such as self-promotion or benevolent information. This is because brand-to-brand praise increases perceptions of brand warmth, which leads to enhanced brand evaluations and choice. The authors support this theory with seven studies conducted in the lab, online, and in the field that feature multiple managerially-relevant outcomes, including brand attitudes, social media and advertising engagement, brand choice, and purchase behavior, in a variety of product and service contexts. The authors also identify key boundary conditions and rule out alternative explanations, further elucidating the underlying mechanism and important implementation insights. This work contributes to our understanding of brand perception and warmth, providing a novel way for brands to connect to consumers by connecting with each other.
Why Boulder Springs has no boulders and no springs: Evolved landscape preferences and naming conventions
Rebecka Hahnel-Peeters, Kyle Peeters & Aaron Goetz
Psychology of Aesthetics, Creativity, and the Arts, forthcoming
Abstract:
Landscapes varied throughout human history, some offering more fitness benefits than others. Therefore, natural selection has likely designed in us landscape preferences that motivated us to seek some environments over others (Orians, 1980). These evolved landscape preferences may influence several aspects of modern-day society, including how we manipulate our urban environment. In Study 1, we conducted a content analysis of the naming conventions of apartment buildings and residential neighborhoods. We hypothesized that there would be more nature words (e.g., valley, river, arbor) in apartment and neighborhood names than nonnature words (e.g., 4th Street; Renaissance, Washington). Names of 2,980 apartment buildings and neighborhoods were collected with a program that uses Google Maps from each of the 48 contiguous United States. Results strongly supported our hypothesis; There were 52% more nature words than nonnature words in the names of apartment buildings and residential neighborhoods. Study 2 used a mixed-subjects experimental design to determine if apartments and neighborhoods with nature names were perceived as more valuable than those without nature names. Participants rated five photographs of apartments and five photographs of neighborhoods photoshopped to display nature or nonnature names for their price (in monthly rent or home's mortgage) and perceived rate of vacancy. Apartments and neighborhoods with manipulated nature names were rated as statistically more expensive. There were no statistical differences between perceived vacancy rates in apartments or neighborhoods named after nature compared with those not named after nature. The current preregistered studies are the first to document that our evolved landscape preferences may affect how developers name our homesteads, further exploiting biophilia.
Does Gender Matter? The Effect of Management Responses on Reviewing Behavior
Davide Proserpio, Isamar Troncoso & Francesca Valsesia
Marketing Science, forthcoming
Abstract:
We study the effect of management responses on the reviewing behavior of self-identified female and male reviewers. Using data from Tripadvisor, we show that after hotels begin to respond to reviews, the probability that a negative review comes from a self-identified female reviewer decreases. To explain these findings, we use a survey to show that female reviewers, when writing a negative review, are more likely to perceive management responses as a source of conflict. To understand whether these concerns are well founded, we use Tripadvisor data to provide evidence of gender bias in the way hotel managers address reviewers writing negative reviews. We show that responses to self-identified female reviewers are more likely to be contentious, that is, confrontational, aggressive, or trying to discredit the reviewer. Finally, to confirm that gender bias directly affects reviewing behavior, we show that the probability that a negative review comes from a self-identified female reviewer is lower for hotels that write more contentious responses. Although the introduction of management responses created a new channel of communication between firms and consumers, our findings show that such a channel can be misused to discriminate and can lead to unexpected consequences such as a reduction of reviews by those users more likely to be discriminated against.
Customers and Retail Growth
Liran Einav et al.
Journal of Monetary Economics, forthcoming
Abstract:
Using Visa debit and credit card transactions in the U.S. from 2016 to 2019, we document the importance of customers in accounting for sales variation across merchants, across stores within retail chains, and over time for individual merchants and stores. Customers, as opposed to transactions per customer or dollar sales per transaction, consistently account for about 80% of sales variation. The top 1% of growing and shrinking merchants account for about 70% of customer and sales reallocation in a given year. In order to illustrate some of the potential implications, we write down an endogenous growth model with and without the customer margin. In the context of this model, we find that the customer margin dramatically increases the size and growth contribution of the largest firms, but lowers the aggregate growth rate by diverting resources from research to customer acquisition activities.
Self-Interested Giving: The Relationship Between Conditional Gifts, Charitable Donations, and Donor Self-Interestedness
Matthew Chao & Geoffrey Fisher
Management Science, forthcoming
Abstract:
Nonprofits regularly use conditional "thank you" gifts to entice prospective donors to give, yet experimental evidence suggests that their effects are mixed in practice. This paper uses multiple laboratory experiments to test when and why thank you gifts vary in effectiveness. First, we demonstrate that although gifts often increase donations to charities that donors did not rate highly, many of the same gifts had no effects or negative effects for charities that prospective donors already liked. We replicate these findings in a second experiment that uses a different range of charity and gift options as well as different measures of participant perceptions of a charity. We also find that making gifts optional, as is common in fundraising campaigns, does not eliminate these negative gift effects. In additional experiments, we directly test for donor motives using self-report and priming experiments. We find that thank you gifts increase (decrease) the weight that donors place on self-interested (prosocial) motives, leading to changes in donation patterns. Altogether, our results suggest that practitioners may find gifts more useful when appealing to donors not already familiar with or favorably inclined to their charity, such as during donor acquisition campaigns. They may be less useful when appealing to recent donors or others who already favor the charity, in part because the gift may activate mindsets or norms that emphasize self-interested motives instead of more prosocial, other-regarding motives.
Response Times in the Wild: eBay Sellers Take Hours Longer to Reject High Offers and Accept Low Offers
Miruna Cotet & Ian Krajbich
Ohio State University Working Paper, March 2021
Abstract:
Hesitation in the marketplace has the potential to betray private information. Recent results from lab experiments have confirmed that subjects' response times reveal their strength-of-preference or belief, even in strategic settings. What remains unclear is whether these results extend beyond the lab to markets with experienced agents. Here we address this question using a dataset consisting of millions of bargaining exchanges from eBay. We find that the time it takes sellers to accept or reject offers is strongly related to the size of the offer. Sellers are quick to accept good offers and to reject bad offers, and slow to accept bad offers and to reject good offers. These response-time differences are on the order of hours. These findings apply to a majority of the exchanges on eBay, and are even stronger with more experienced sellers. Overall, these results indicate that there is information in response-time data from non-lab markets, and that a majority of agents do not have prepared strategies but instead evaluate offers on the spot in a way that reveals their values for the goods.
Reciprocity and Unveiling in Two-Sided Reputation Systems: Evidence from an Experiment on Airbnb
Andrey Fradkin, Elena Grewal & David Holtz
Marketing Science, forthcoming
Abstract:
Reputation systems are used by nearly every digital marketplace, but designs vary and the effects of these designs are not well understood. We use a large-scale experiment on Airbnb to study the causal effects of one particular design choice - the timing with which feedback by one user about another is revealed on the platform. Feedback was hidden until both parties submitted a review in the treatment group and was revealed immediately after submission in the control group. The treatment stimulated more reviewing in total. This is due to users' curiosity about what their counterparty wrote and/or the desire to have feedback visible to other users. We also show that the treatment reduced retaliation and reciprocation in feedback and led to lower ratings as a result. The effects of the policy on feedback did not translate into reduced adverse selection on the platform.