Are consumers fooled by discounts? An experimental test in a consumer search environment

In this article, we investigate experimentally whether people search optimally and how price promotions influence search behaviour. We implement a sequential search task with exogenous price dispersion in a baseline treatment and introduce discounts in two experimental treatments. We find that search behaviour is roughly consistent with optimal search but also observe some discount biases. If subjects do not know in advance where discounts are offered, the purchase probability is increased by 19 percentage points in shops with discounts, even after controlling for the benefit of the discount and for risk preferences. If consumers know in advance where discounts are given, then the bias is only weakly significant and much smaller (7 percentage points).

Cross-cultural consumer/consumption research : dealing with issues emerging from globalization and fragmentation

To understand the effects of globalization and fragmentation, macromarketing scholars need insights about links between individual consumer behavior and societal outcomes. The challenge in this regard is to create a program of macrooriented cross-cultural research. This article offers a crosscultural consumer behavior research framework for this purpose. The framework encompasses four key areas of consumer behavior that are related to the forces of globalization and fragmentation, including the environment, identity, wellbeing,and market structure and policy. A discussion of these substantive areas is followed by a suggested macro-microoriented research agenda and a call for paradigm plurality in pursuing this agenda.

The exploration of consumer power in online brand communities : a comparison case study in Australia and China

Aided by the development of information technology, the balance of power in the market place is rapidly shifting from marketers towards consumers and nowhere is this more obvious than in the online environment (Denegri-Knott, Zwick, & Schroeder, 2006; Moynagh & Worsley, 2002; Newcomer, 2000; Samli, 2001). From the inception and continuous development of the Internet, consumers are becoming more empowered. They can choose what they want to click on the Internet, they can shop and transact payments, watch and download video, chat with others, be it friends or even total strangers. Especially in online communities, like-minded consumers share and exchange information, ideas and opinions. One form of online community is the online brand community, which gathers specific brand lovers. As with any social unit, people form different roles in the community and exert different effects on each other. Their interaction online can greatly influence the brand and marketers. A comprehensive understanding of the operation of this special group form is essential to advancing marketing thought and practice (Kozinets, 1999). While online communities have strongly shifted the balance of power from marketers to consumers, the current marketing literature is sparse on power theory (Merlo, Whitwell, & Lukas, 2004). Some studies have been conducted from an economic point of view (Smith, 1987), however their application to marketing has been limited. Denegri-Knott (2006) explored power based on the struggle between consumers and marketers online and identified consumer power formats such as control over the relationship, information, aggregation and participation. Her study has built a foundation for future power studies in the online environment. This research project bridges the limited marketing literature on power theory with the growing recognition of online communities among marketing academics and practitioners. Specifically, this study extends and redefines consumer power by exploring the concept of power in online brand communities, in order to better understand power structure and distribution in this context. This research investigates the applicability of the factors of consumer power identified by Denegri-Knott (2006) to the online brand community. In addition, by acknowledging the model proposed by McAlexander, Schouten, & Koenig (2002), which emphasized that community study should focus on the role of consumers and identifying multiple relationships among the community, this research further explores how member role changes will affect power relationships as well as consumer likings of the brand. As a further extension to the literature, this study also considers cultural differences and their effect on community member roles and power structure. Based on the study of Hofstede (1980), Australia and China were chosen as two distinct samples to represent differences in two cultural dimensions, namely individualism verses collectivism and high power distance verses low power distance. This contribution to the research also helps answer the research gap identified by Muñiz Jr & O'Guinn (2001), who pointed out the lack of cross cultural studies within the online brand community context. This research adopts a case study methodology to investigate the issues identified above. Case study is an appropriate research strategy to answer “how” and “why” questions of a contemporary phenomenon in real-life context (Yin, 2003). The online brand communities of “Haloforum.net” in Australia and “NGA.cn” in China were selected as two cases. In-depth interviews were used as the primary data collection method. As a result of the geographical dispersion and the preference of a certain number of participants, online synchronic interviews via MSN messenger were utilized along with the face-to-face interviews. As a supplementary approach, online observation was carried over two months, covering a two week period prior to the interviews and a six week period following the interviews. Triangulation techniques were used to strengthen the credibility and validity of the research findings (Yin, 2003). The findings of this research study suggest a new definition of power in an online brand community. This research also redefines the consumer power types and broadens the brand community model developed by McAlexander et al. (2002) in an online context by extending the various relationships between brand and members. This presents a more complete picture of how the perceived power relationships are structured in the online brand community. A new member role is discovered in the Australian online brand community in addition to the four member roles identified by Kozinets (1999), in contrast however, all four roles do not exist in the Chinese online brand community. The research proposes a model which links the defined power types and identified member roles. Furthermore, given the results of the cross-cultural comparison between Australia and China showed certain discrepancies, the research suggests that power studies in the online brand community should be country-specific. This research contributes to the body of knowledge on online consumer power, by applying it to the context of an online brand community, as well as considering factors such as cross cultural difference. Importantly, it provides insights for marketing practitioners on how to best leverage consumer power to serve brand objective in online brand communities. This, in turn, should lead to more cost effective and successful communication strategies. Finally, the study proposes future research directions. The research should be extended to communities of different sizes, to different extents of marketer control over the community, to the connection between online and offline activities within the brand community, and (given the cross-cultural findings) to different countries. In addition, a greater amount of research in this area is recommended to determine the generalizability of this study.

Consumer acceptance of m-services : Marketing implcations

Consumers' evolving relationships with their mobile devices and their desire to access mobile services (m-services) present new opportunities to marketers, yet little research has been conducted in the area of m-services. Using structural equation modelling, this paper examines the effect of hedonic and utilitarian value of mobile phones on product and purchase involvement. It also investigates the effect of involvement, innovativeness, and self-efficacy on use of m-services. Data were collected from a convenience sample of 250 respondents using an online survey and a modified snowball procedure. Findings are discussed, further implications for managers are suggested and directions for future research are proposed.

Teenagers' perceptions of advertising in the online social networking environment : an exploratory study

This study explores teenager perceptions towards advertising in the online social networking environment. The future of online social networking sites is dependant upon the continued support of advertisers in this new medium, which is linked to the acceptance of advertising on these sites by their targeted audience. This exploratory study used the qualitative research methods of focus groups and in-depth personal interviews to gain insights from the teenager participants. The literature review in Chapter Two examined the previous research into advertising theories, consumer attitudes and issues such as advertising avoidance, advertising as a service and trust and privacy in the online social networking environment. The teenage consumer was also examined as were the influences of social identity theory. From this literature review eleven propositions were formed which provided a structure to the analysis of the research. Chapter Three outlined the multi-method research approach of using focus groups and in-depth interviews. The key findings were outlined in Chapter Four and Chapter Five provides discussion regarding these findings and the implications for theory and advertising practice. The main findings from this study suggest that teenagers have very high levels of advertising avoidance and are sceptical towards advertising on their online social networking sites. They have an inherent distrust of commercial messages in the online social networking environment; however they are extremely trusting with the information that they disclose online. They believe that if their site is classified as private, then the information disclosed on this site is not accessible to anyone. The study explores the reasons behind these views. This research has resulted in the identification of seven motivations behind online social networking use. A new model of advertising avoidance in the online social networking environment is also presented and discussed. This model makes a contribution towards filling the gap in available research on online social networking sites and advertising perception. The findings of this study have also resulted in the identification of the characteristics of online social networking sites as an advertising medium. The newness of online social networking sites coupled with the enthusiastic adoption of online social networking by the teenage demographic means that this exploratory study will be of interest to both academics and practitioners alike.

Audience & Market Foresight : Consumer Trends in Digital News and Information in Australia

We all know that the future of news is digital. But mainstream news providers are still grappling with how to entice more customers to digital news. This paper provides context for a survey currently underway on user intentions towards digital news and entertainment, by exploring: 1. Consumer behaviours and intentions towards digital news and information use; 2. Current trends in the Australian online news and information sector; 3. Issues and emerging opportunities in the Australian (and global) environment. Key influences on digital use of news and information are pricing and access. The paper highlights emerging technical opportunities and flags service gaps as at December 2008. These gaps include multiple disconnects between: 1. Changing user intentions towards online and location based news (news based on a specific locality as chosen by the user) and information; 2. The ability by consumers to act on these intentions via the availability and cost of technologies; 3. Younger users prefer entertainment to news; 4. Current digital offerings of traditional news providers and opportunities. These disconnects present an opportunity for online news suppliers to appraise and resolve. Doing so may enhance their online news and information offering, attract consumers and improve loyalty. Outcomes from this paper will be used to identify knowledge gaps and contribute to the development of further analysis on Australian consumers and their behaviours and intentions towards online news and information. This will be ndertaken via focus groups as part of a broader study by researchers at the Creative Industries Faculty at the Queensland University of Technology supported by the Smart Services Cooperative Research Centre.

Consumer trends in digital news and information in Australia

We all know that the future of news is digital. But mainstream news providers are still grappling with how to entice more customers to their online sites. This paper provides context for a survey currently underway on user intentions towards online news and entertainment, by exploring: 1. Consumer behaviours and intentions with regards to accessing online news and information; 2. Current trends in the Australian online news and information sector; and 3. Key issues and emerging opportunities in the Australian (and global) environment. Key influences on use of online news and information are pricing and access. The paper highlights emerging technical opportunities and flags service gaps. These gaps include multiple disconnects between: 1. Changing user intentions towards online and location based news (news based on a specific locality as chosen by the user) and information; 2. The ability by consumers to act on these intentions via the availability and cost of technologies; 3. Younger users may prefer entertainment to news, or ‘infotainment’; and 4. Current online offerings of traditional news providers and opportunities. These disconnects present an opportunity for online news suppliers to appraise and resolve. Doing so may enhance their online news and information offering, attract consumers and improve loyalty. Outcomes from this paper will be used to identify knowledge gaps and contribute to the development of further analysis on Australian consumers and their behaviours and intentions towards online news and information. This will be undertaken via focus groups as part of a broader study.

Featureless vehicle-based visual SLAM with a consumer camera

The Simultaneous Localisation And Mapping (SLAM) problem is one of the major challenges in mobile robotics. Probabilistic techniques using high-end range finding devices are well established in the field, but recent work has investigated vision-only approaches. We present an alternative approach to the leading existing techniques, which extracts approximate rotational and translation velocity information from a vehicle-mounted consumer camera, without tracking landmarks. When coupled with an existing SLAM system, the vision module is able to map a 45 metre long indoor loop and a 1.6 km long outdoor road loop, without any parameter or system adjustment between tests. The work serves as a promising pilot study into ground-based vision-only SLAM, with minimal geometric interpretation of the environment.

The effectiveness of marketing communication within the immersive environment

Immersive environments are part of a recent media innovation that allow users to become so involved within a computer-based simulated environment that they feel part of that virtual world (Grigorovici, 2003). A specific example is Second Life, which is an internet-based, three-dimensional immersive virtual world in which users create an online representation of themselves (an avatar) to play games and interact socially with thousands of people simultaneously. This study focuses on Second Life as an example of an immersive environment, as it is the largest adult freeform virtual world, home to 12 million avatars (IOWA State University, 2008). Already in Second Life there are more than 100 real-life brands from a range of industries, including automotive, professional services, and consumer goods and travel, among others (KZero, 2007; New Business Horizons, 2009). Compared to traditional advertising media, this interactive media can immerse users in the environment. As a result of this interactivity, users can become more involved with a virtual environment, resulting in prolonged usage over weeks, months and even years. Also, it can facilitate presence. Despite these developments, little is known about the effectiveness of marketing messages in a virtual world context. Marketers are incorporating products into Second Life using a strategy of online product placement. This study, therefore, explores the perceived effectiveness of online product placement in Second Life in terms of effects on product/brand recall, purchase intentions and trial. This research examines the association between individuals’ involvement with Second Life and online product placement effectiveness, as well as the relationship between individuals’ Second Life involvement and the effectiveness of online product placement. In addition, it investigates the association of immersion and product placement involvement. It also examines the impact of product placement involvement on online product placement effectiveness and the role of presence in affecting this relationship. An exploratory study was conducted for this research using semi-structured in-depth interviews face-to-face, email-based and in-world. The sample comprised 24 active Second Life users. Results indicate that product placement effectiveness is not directly associated with Second Life involvement, but rather effectiveness is impacted through the effect of Second Life involvement on product placement involvement. A positive relationship was found between individuals’ product placement involvement and online product placement effectiveness. Findings also indicate that online product placement effectiveness is not directly associated with immersion. Rather, it appears that effectiveness is impacted through the effect of immersion on product placement involvement. Moreover, higher levels of presence appear to have a positive impact on the relationship between product placement involvement and product placement effectiveness. Finally, a model was developed from this qualitative study for future testing. In terms of theoretical contributions, this study provides a new model for testing the effectiveness of product placement within immersive environments. From a methodological perspective, in-world interviews as a new research method were undertaken. In terms of a practical contribution, findings identified useful information for marketers and advertising agencies that aim to promote their products in immersive virtual environments like Second Life.

Consumer clothing disposal behaviour: A comparative study

Fast fashion retailing is leading consumers towards an increased rate of purchasing and the trend to keep clothing for an ever shorter time with the resulting rise in clothing disposal. The aim of this paper is to empirically explore antecedents of two methods of sustainable clothing disposal behaviour in two countries: donating to charities and giving away to family and friends. Using data from females located in Australia and Chile, the authors test the proposed model with structural equation modelling (SEM). The results of this study show that consumer recycling behaviour is a strong and direct driver of donating to charity. In addition, results find that consumer awareness of the environment and consumer age affect donating behaviour. The findings have value for fast fashion retailers, marketers, environmental activists, ecological researchers, charity institutions and public policy makers.

Mobilizing the brand experience: The adoption and use of mobile media in building consumer relationships in China

This research examines why and how brand owners in China adopt and use mobile media in marketing campaigns to deliver co-creation brand experiences and build consumer relationships. China represents an interesting case to study as it has leapfrogged into the age of consumer society and mobile media adoption. As the largest mobile market globally, it has experienced the intensity of mobile technology diffusion; and with it the rise of mobile consumer culture and participatory culture. Further, the rising individualism and the socio-cultural heritage in collectivism serve as a structuring tension in how mobile media is leveraged in marketing to cater to consumers' desires for individuality and social interaction. First, through expert interviews guided by the technology-organization-environment (TOE) framework (Tornatzky & Fleischer, 1990) as well as integrating innovation diffusion theory (E. Rogers, 2003), this research attempts to fill the gap of theoretical application in mobile marketing adoption at the firm level in China, and unravel the adoption factors of mobile marketing by brand owners in China. In total, 27 semi-structured interviews were conducted with key industry informants from mobile agencies, traditional agencies, venture capital firms, mobile content and service providers, mobile portals, and marketing management at brand owners. Second, based on case studies in China, this research investigates the use of mobile marketing to facilitate innovative co-creation of brand experience to cater to both individualistic as well as collective tendencies and desires amongst Chinese consumers. Through multiple case studies of the campaigns conducted by Nokia, Clean & Clear, and The North Face, and informed by in-depth interviews and document analysis, this research analyses the role of mobile media in marketing campaigns along three dimensions: the role of mobile media in content generation and consumption, the centrality of mobile media as text, tools or platforms; and the interactive environment. Specifically, the cases are organized along the spectrum from user-generated content to corporate-generated content, mobile media's role from being supplementary to it being central, and from a virtual environment to a hybrid environment. Overall, these cases demonstrate how brand owners adapt mobile media as text, tools, platforms, and environments to deliver co-creation brand experiences exploiting both individualistic as well as collective tendencies and desires amongst Chinese consumers. This research contributes to the literature on firm adoption of mobile marketing, and the role of the mobile media in facilitating co-creation experiences for Chinese consumers. It develops a model of the technological, organizational and environmental factors influencing mobile marketing adoption by firms, and provides a model explaining the role of mobile media in facilitating brand experience co-creation. The findings also demonstrate that mobile media can be leveraged to facilitate co-creation brand experience to generate added value; and meanwhile cater to both the rising individualism and the deep-seated collectivism of Chinese consumers. Empirically, it assists industry practitioners in understanding the adoption of mobile marketing in China, especially those on the supply side in order to improve their offerings and propositions. It also assists brand owners and agencies in designing their mobile marketing strategies to build consumer relationships in China.

Risk, trust, and consumer online purchasing behaviour : a Chilean perspective

Purpose: The purpose of this study is to investigate Latin American online purchase behaviour with a specific focus on the influence of perceived risk and trust. While studies of this nature have been conducted quite extensively in developed countries, their application in developing countries, such as Latin America is limited. Our study addresses this gap in the literature with an empirical study conducted in Chile. Design/methodology/approach: The authors develop and test a proposed model of the influence of consumer’s perceptions of risk and trust on their attitudes and intentions to purchase on the Internet. An online survey method is used. The sample consists of 176 Chilean consumers who have made at least one purchase online. The data is analysed using structural equation modelling technique (SEM). Findings: The analysis revealed that of the perceived risk and trust factors examined, trust in third party assurances and a cultural environment of trust had the strongest positive influence on intentions to continuing purchasing online. Perceived risk had an inverse relationship with attitude and consumers’ attitude has a positive influence on intentions to purchase online. Trust in online vendors and a propensity to trust were both insignificant. Practical implications: Practically, these results identity which risk and trust beliefs towards purchasing online have the most effect thereby providing insights into how companies should seek to mitigate perceptions of risk to encourage new and return purchasers. Additionally, this research shows that consumers in a Latin American country, recognised as a collectivist, high risk avoidance culture, are willing to make purchases online despite the risks involved. Originality/value: The study and its results is one of few available that consider a Latin American context. The value of the findings provides insights into the specific risk and trust factors that influence Chilean consumers when considering purchasing online. The tested model adds value not only to the literature on Latin American consumer behaviour but also provides guidance for companies offering online retailing facilities in these less developed countries.

Selection of project procurement methods in the consumer electronics industry : a Hong Kong study

Under pressure from both the ever increasing level of market competition and the global financial crisis, clients in consumer electronics (CE) industry are keen to understand how to choose the most appropriate procurement method and hence to improve their competitiveness. Four rounds of Delphi questionnaire survey were conducted with 12 experts in order to identify the most appropriate procurement method in the Hong Kong CE industry. Five key selection criteria in the CE industry are highlighted, including product quality, capability, price competition, flexibility and speed. This study also revealed that product quality was found to be the most important criteria for the “First type used commercially” and “Major functional improvements” projects. As for “Minor functional improvements” projects, price competition was the most crucial factor to be considered during the PP selection. These research findings provide owners with useful insights to select the procurement strategies.

Evaluation of implementation of a healthy food and drink supply strategy throughout the whole school environment in Queensland state schools, Australia

BACKGROUND/OBJECTIVES: This paper reports on the evaluation of the Smart Choices healthy food and drink supply strategy for Queensland schools (Smart Choices) implementation across the whole school environment in state government primary and secondary schools in Queensland, Australia. SUBJECTS/METHODS: Three concurrent surveys using different methods for each group of stakeholders that targeted all 1275 school Principals, all 1258 Parent and Citizens’ Associations (P&Cs) and a random sample of 526 tuckshop convenors throughout Queensland. Nine hundred and seventy-three Principals, 598 P&Cs and 513 tuckshop convenors participated with response rates of 78%, 48% and 98%, respectively. RESULTS: Nearly all Principals (97%), P&Cs (99%) and tuckshop convenors (97%) reported that their school tuckshop had implemented Smart Choices. The majority of Principals and P&Cs reported implementation, respectively, in: school breakfast programs (98 and 92%); vending machine stock (94 and 83%); vending machine advertising (85 and 84%); school events (87 and 88%); school sporting events (81 and 80%); sponsorship and advertising (93 and 84%); fundraising events (80 and 84%); and sporting clubs (73 and 75%). Implementation in curriculum activities, classroom rewards and class parties was reported, respectively, by 97%, 86% and 75% of Principals. Respondents also reported very high levels of understanding of Smart Choices and engagement of the school community. CONCLUSIONS: The results demonstrated that food supply interventions to promote nutrition across all domains of the school environment can be implemented successfully.

Ecological dynamics as a theoretical framework for development of sustainable behaviours towards the environment

This paper proposes how the theoretical framework of ecological dynamics can provide an influential model of the learner and the learning process to pre-empt effective behaviour changes. Here we argue that ecological dynamics supports a well established model of the learner ideally suited to the environmental education context because of its emphasis on the learner-environment relationship. The model stems from perspectives on behaviour change in ecological psychology and dynamical systems theory. The salient points of the model are highlighted for educators interested in manipulating environmental constraints in the learning process, with the aim of designing effective learning programs in environmental education. We conclude by providing generic principles of application which might define the learning process in environmental education programs.