Consumer responses to free service trial offers

Consumers find it difficult to evaluate services they have not previously used, especially where these services have high experience or credence properties (Mittal 2002, 2004). A frequent promotional strategy used by marketers is to offer a free trial, such as a free brake check on cars or a free session at a new gym. While there is extensive literature on product trials, very little research has been conducted on free service trial offers. This led the researchers to undertake preliminary content analysis and qualitative interviews and ultimately to develop a comprehensive model of consumer evaluations of these offers. The model takes account of the type of service on offer, the manner in which it is offered and the pricing mechanism used (free versus discounted). It also characterizes the cognitive and emotional evaluations consumers make in response to these offers and how these contribute to trial and purchase propensity. Individual characteristics of consumers, such as deal proneness, were also incorporated into the model. The current study reports an experiment where the model was systematically tested among groups of male and female consumers (in total 400) who varied by age group and service experience. The research indicated that a free trial offer operated rather differently from a discount, inducing a sense of obligation which motivated some people to adopt the trial and subsequent full service offer. Traditional trial-cognition-evaluation models (e.g. Smith and Swinyard, 1983) are not sufficient to explain the phenomena uncovered by this research.

Variation in consumer outcomes : does the type of failure (process or outcome) matter?

Literature suggests that various customer outcomes are likely to be negative after a failed service encounter. Service failures can arise for many reasons and consumers may react differently, depending on the type of failure. This study focuses on exploring whether consumer outcomes differ based on whether the consumer experiences a process failure or outcome failure. The results from this study suggest that variations in consumer outcomes differ across the two types of failures; with consumers generally being more dissatisfied in outcome failure situations as compared to process failure situations.

Reducing consumer switching intentions following service failure : do empowerment and apology help?

This research explores the effectiveness of apology and empowerment as service recovery actions and their impact on consumers switching intentions within the hospitality industry. It also examines two different types of failure - process failure and outcome and whether consumer-switching intentions vary based on failure type. Results suggest that apology is effective in reducing switching intentions in both types of failure. Employee empowerment reduces switching intentions in outcome failure situations, but increases switching intentions in process settings. There is also an interaction effect of apology and empowerment in the outcome failure setting, but not in the process failure setting. Recommendations for managing service recovery are provided.

Chinese consumers' perceptions of country design, assembly and parts capabilities : does country considered or consumer acculturation matter?

Chinese consumers are facing a diverse range of choices in regards to products produced wholly or in part overseas or by overseas corporations based in China. This study examines how consumers from China, both residing at home and abroad, perceived capability of Germany, Japan, US and China in regard to three dimensions of country capabilities- design, assembly and parts/components. The findings show that consumers have different perceptions concerning country capabilities and that Chinese consumers residing overseas appear to have more positive perceptions of foreign countries’ capabilities.

The impact of consumer ethnocentrism and country of origin sub-components for high involvement products on young Chinese consumers' product assessments

Purpose – The purpose of this paper is to examine the effect of country of origin (COO) sub-components (i.e. design, assembly and parts), as well as the extent to which consumer ethnocentrism tendencies interact with these COO sub-components for young Chinese consumers with regards to product quality assessments and purchase intentions.

Design/methodology/approach – A 2?×?2?×?2 factorial experimental design was used to examine the effects of the three sub-components of COO with two levels of sourcing location – Home (China) and Foreign (Germany), for two high involvement products (an automobile and a digital camera). Chinese students in China represented the sample of 272 respondents. MANOVA was used to examine the direct effects and interactions of the three COO components, as well as ethnocentrism, measured using the CETSCALE.

Findings – It was found that the three COO sub-components did not influence young Chinese consumers’ evaluation of product quality or purchase intentions. In addition, consumers’ level of ethnocentrism also did not have a direct effect on perceived product quality or purchase intentions. There was only one statistically significant interaction effect between ethnocentrism and country of parts for one of the two products. As such, COO dimensions and young Chinese consumers’ ethnocentrism appears to have limited influence on their assessments of product quality or purchase intentions. This may occur because young Chinese consumers perceive that hybrid products are the norm for high involvement products in China as these products are all these consumers have experienced.

Originality/value – The findings of this research dispute the commonly held belief and evidence that sub-components of COO have an impact on the perceptions of product quality and purchase intentions. Young Chinese consumers may be different to consumers from western countries because they have been extensively exposed to hybrid products. Given the size and growth potential of China, young Chinese are an important, under-researched segment within the Chinese market.

An empirical investigation of the effect of interaction justice perception on consumer intentions after complaining

This study examined how apology as interaction justice impacts on consumer perceptions of service recovery attempt.  Data was collected using hypothetical scenarios.  Two types of service failures were proposed and the impact of recovery action on each failure type was compared.  Findings include that there is direct effect of recovery action on consumer future intentions in both type of failures.  Implications and direction to the future research were proposed.

Longitudinal study of Consumer Price Index (CPI) trends in core and non-core foods in Australia

Objective: This study examined trends in the price of healthy and less-healthy foods from 1989 to 2007 using the Australian Consumer Price Index (CPI).

Methods: CPI food expenditure classes were classified as 'core' or 'non-core'. Trends in the CPI were analysed to examine the rise in prices of core compared with non-core foods.

Results: On average, the CPI for core foods has risen at a slightly higher, though not statistically significant, rate than non-core foods. Furthermore, selected groupings reveal interesting patterns. 'Bread' has risen in price significantly more than 'cakes and biscuits', and 'milk' has risen in price significantly more than 'soft drinks, waters and juices'.

Conclusions and implications: This investigation of food price trends reveals notable differences between core and non-core foods. This should be investigated further to determine the extent to which this contributes to the higher prevalence of diet-related diseases in low socio-economic groups.

Corporate social responsibility, new activism and public relations

Purpose – This paper aims to analyse why some contemporary corporate organisations are reluctant to articulate the effect of their market positioning behaviour on the unwilling communities that oppose their activities. It describes the communicative interactions between several large corporate organisations and the grassroots activist groups opposing their activities, in Victoria, Australia.

Design/methodology/approach – Extensive secondary data were collected, including extensive newspaper and radio transcripts from the campaign periods, web site downloads, letters and other campaign documents. The research design applied to the data, a qualitative, interpretative analysis, drawing on key theoretical frameworks.

Findings – The research findings suggest that powerful protest strategies, combined with the right political and social conditions, and a shift in the locus of politics and expertise, bring to light public concerns about the ethics of corporate practices, such as public relations, used egocentrically by organisations, to harmonise their activities in late modern Western society. It finds that no serious overhaul of business ethics can occur until the unity of public relations is critically scrutinised and reformed. It helps define an alternative holistic communicative approach which could be applied more widely to business practice that helps avoid the limitations and relativism of public relations.

Originality/value – The research flags new ways of thinking expressed in the notion of public communication that could lead to creative and unusual coherences vital to deal with the apparent ecological challenges for society in late modernity.

New activism and communication in Australian risk society : a case study of the Otway Ranges Environment Network

This paper overviews a case study of environmental grassroots activism in Victoria, Australia, between 1995 and 2003. The Otway Ranges Environment Network (OREN) is significant for its successful communication campaign to change forest practices and policy decision-making in the Otway Ranges, and for its intervention in a long-standing and exclusive relationship between government and the timber industry. This paper describes and analyses pivotal parts of the OREN campaign: firstly, the group's strategy to boycott paper and pulp manufacture Kimberly-Clark Australia; and secondly, its decision to participate in the West Victoria Regional Forest Agreement (RFA) process to negotiate the future of Otway forest. Informed by the empirical research and the works of social theorists Ulrich Beck and Jurgen Habermas, this paper outlines a strategic approach to communication that is effective, fair and sustainable, and that can be applied by other non-profits - especially those that operate in politically volatile environments with a grassroots agenda.