Estimating the SCAN*PRO model of store sales: HB, FM or just OLS?

In this paper we investigate whether consideration of store-level heterogeneity in marketing mix effects improves the accuracy of the marketing mix elasticities, fit, and forecasting accuracy of the widely-applied SCAN*PRO model of store sales. Models with continuous and discrete representations of heterogeneity, estimated using hierarchical Bayes (HB) and finite mixture (FM) techniques, respectively, are empirically compared to the original model, which does not account for store-level heterogeneity in marketing mix effects, and is estimated using ordinary least squares (OLS). The empirical comparisons are conducted in two contexts: Dutch store-level scanner data for the shampoo product category, and an extensive simulation experiment. The simulation investigates how between- and within-segment variance in marketing mix effects, error variance, the number of weeks of data, and the number of stores impact the accuracy of marketing mix elasticities, model fit, and forecasting accuracy. Contrary to expectations, accommodating store-level heterogeneity does not improve the accuracy of marketing mix elasticities relative to the homogeneous SCAN*PRO model, suggesting that little may be lost by employing the original homogeneous SCAN*PRO model estimated using ordinary least squares. Improvements in fit and forecasting accuracy are also fairly modest. We pursue an explanation for this result since research in other contexts has shown clear advantages from assuming some type of heterogeneity in market response models. In an Afterthought section, we comment on the controversial nature of our result, distinguishing factors inherent to household-level data and associated models vs. general store-level data and associated models vs. the unique SCAN*PRO model specification.

Interactive data in financial reporting:the construction of the non-professional investor

The Securities and Exchange Commission (SEC) in the United States and in particular its immediately past chairman, Christopher Cox, has been actively promoting an upgrade of the EDGAR system of disseminating filings. The new generation of information provision has been dubbed by Chairman Cox, "Interactive Data" (SEC, 2006). In October this year the Office of Interactive Disclosure was created(http://www.sec.gov/news/press/2007/2007-213.htm). The focus of this paper is to examine the way in which the non-professional investor has been constructed by various actors. We examine the manner in which Interactive Data has been sold as the panacea for financial market 'irregularities' by the SEC and others. The academic literature shows almost no evidence of researching non-professional investors in any real sense (Young, 2006). Both this literature and the behaviour of representatives of institutions such as the SEC and FSA appears to find it convenient to construct this class of investor in a particular form and to speak for them. We theorise the activities of the SEC and its chairman in particular over a period of about three years, both following and prior to the 'credit crunch'. Our approach is to examine a selection of the policy documents released by the SEC and other interested parties and the statements made by some of the policy makers and regulators central to the programme to advance the socio-technical project that is constituted by Interactive Data. We adopt insights from ANT and more particularly the sociology of translation (Callon, 1986; Latour, 1987, 2005; Law, 1996, 2002; Law & Singleton, 2005) to show how individuals and regulators have acted as spokespersons for this malleable class of investor. We theorise the processes of accountability to investors and others and in so doing reveal the regulatory bodies taking the regulated for granted. The possible implications of technological developments in digital reporting have been identified also by the CEO's of the six biggest audit firms in a discussion document on the role of accounting information and audit in the future of global capital markets (DiPiazza et al., 2006). The potential for digital reporting enabled through XBRL to "revolutionize the entire company reporting model" (p.16) is discussed and they conclude that the new model "should be driven by the wants of investors and other users of company information,..." (p.17; emphasis in the original). Here rather than examine the somewhat illusive and vexing question of whether adding interactive functionality to 'traditional' reports can achieve the benefits claimed for nonprofessional investors we wish to consider the rhetorical and discursive moves in which the SEC and others have engaged to present such developments as providing clearer reporting and accountability standards and serving the interests of this constructed and largely unknown group - the non-professional investor.

Do intelligent heating controls out-smart ordinary users?

Nearly a third of UK gas and electricity is used in homes, of which 80% is for space heating and hot water provision. Rising consumer bills, concerns about climate change and the surge in personal digital technology use has provoked the development of intelligent domestic heating controls. Whilst the need for having suitable control of the home heating system is essential for reducing domestic energy use, these heating controls rely on appropriate user interaction to achieve a saving and it is unclear whether these ‘smart’ heating controls enhance the use of domestic heating or reduce energy demand. This paper describes qualitative research undertaken with a small sample of UK householders to understand how people use new heating controls installed in their homes and what the requirements are for improved smart heating control design. The paper identifies, against Nielsen’s usability heuristics, the divergence between the householder’s use, understanding and expectations of the heating system and the actual design of the system. Digital and smart heating control systems should be designed to maximise usability so that they can be effectively used for efficient heating control by all users. The research highlights the need for development of new systems to readdress the needs of users and redefine the system requirements.