Author: Sridhar Moorthy
Publisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
Direct marketing is witnessing explosive growth. As consumers increasingly purchase products from their homes, their ability to judge the quality of products they buy is significantly reduced. In this paper we study how money-back guarantees can signal product quality in such environments. We interpret product quality broadly to mean both the level of attributes promised as well as the firm s consistency in delivering on those promises. A key aspect of our formulation is the explicit consideration of transaction costs and alternative signals of product quality. Transaction costs are the costs the seller or buyer faces when redeeming a money-back guarantee. We show that money- back guarantees cannot work as a signal of quality without seller transaction costs. However, if these costs are very large, then there are less costly ways to signal, namely by charging a high price. We compare the signaling performance of (1) price, (2) price with uninformative advertising (+money-burning ), and (3) price with a money-back guarantee. Whereas uninformative advertising does not work at all in our model, under certain conditions a money-back guarantee is necessary to signal, and under other conditions, a money-back guarantee is a useful supplement to price.
Signaling Quality with a Money-Back Guarantee
Author: Sridhar Moorthy
Publisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
Direct marketing is witnessing explosive growth. As consumers increasingly purchase products from their homes, their ability to judge the quality of products they buy is significantly reduced. In this paper we study how money-back guarantees can signal product quality in such environments. We interpret product quality broadly to mean both the level of attributes promised as well as the firm s consistency in delivering on those promises. A key aspect of our formulation is the explicit consideration of transaction costs and alternative signals of product quality. Transaction costs are the costs the seller or buyer faces when redeeming a money-back guarantee. We show that money- back guarantees cannot work as a signal of quality without seller transaction costs. However, if these costs are very large, then there are less costly ways to signal, namely by charging a high price. We compare the signaling performance of (1) price, (2) price with uninformative advertising (+money-burning ), and (3) price with a money-back guarantee. Whereas uninformative advertising does not work at all in our model, under certain conditions a money-back guarantee is necessary to signal, and under other conditions, a money-back guarantee is a useful supplement to price.
Publisher:
ISBN:
Category :
Languages : en
Pages :
Book Description
Direct marketing is witnessing explosive growth. As consumers increasingly purchase products from their homes, their ability to judge the quality of products they buy is significantly reduced. In this paper we study how money-back guarantees can signal product quality in such environments. We interpret product quality broadly to mean both the level of attributes promised as well as the firm s consistency in delivering on those promises. A key aspect of our formulation is the explicit consideration of transaction costs and alternative signals of product quality. Transaction costs are the costs the seller or buyer faces when redeeming a money-back guarantee. We show that money- back guarantees cannot work as a signal of quality without seller transaction costs. However, if these costs are very large, then there are less costly ways to signal, namely by charging a high price. We compare the signaling performance of (1) price, (2) price with uninformative advertising (+money-burning ), and (3) price with a money-back guarantee. Whereas uninformative advertising does not work at all in our model, under certain conditions a money-back guarantee is necessary to signal, and under other conditions, a money-back guarantee is a useful supplement to price.
Price and "money Back Guarantees" as Signals of Product Quality
Author: Shiou Shieh
Publisher:
ISBN:
Category : Price indexes
Languages : en
Pages : 38
Book Description
Publisher:
ISBN:
Category : Price indexes
Languages : en
Pages : 38
Book Description
The Economics of a Money-back Guarantee in Retailing
Author: Yanhong Jin
Publisher:
ISBN:
Category :
Languages : en
Pages : 270
Book Description
Publisher:
ISBN:
Category :
Languages : en
Pages : 270
Book Description
Warranty and Price as Quality Signals
Author: Sultan Alaswad Alenazi
Publisher:
ISBN:
Category : Consumer goods
Languages : en
Pages : 110
Book Description
Publisher:
ISBN:
Category : Consumer goods
Languages : en
Pages : 110
Book Description
Handbook of the Economics of Marketing
Author:
Publisher: North Holland
ISBN: 0444637591
Category : Business & Economics
Languages : en
Pages : 632
Book Description
Handbook of the Economics of Marketing, Volume One: Marketing and Economics mixes empirical work in industrial organization with quantitative marketing tools, presenting tactics that help researchers tackle problems with a balance of intuition and skepticism. It offers critical perspectives on theoretical work within economics, delivering a comprehensive, critical, up-to-date, and accessible review of the field that has always been missing. This literature summary of research at the intersection of economics and marketing is written by, and for, economists, and the book's authors share a belief in analytical and integrated approaches to marketing, emphasizing data-driven, result-oriented, pragmatic strategies. Helps academic and non-academic economists understand recent, rapid changes in the economics of marketing Designed for economists already convinced of the benefits of applying economics tools to marketing Written for those who wish to become quickly acquainted with the integration of marketing and economics
Publisher: North Holland
ISBN: 0444637591
Category : Business & Economics
Languages : en
Pages : 632
Book Description
Handbook of the Economics of Marketing, Volume One: Marketing and Economics mixes empirical work in industrial organization with quantitative marketing tools, presenting tactics that help researchers tackle problems with a balance of intuition and skepticism. It offers critical perspectives on theoretical work within economics, delivering a comprehensive, critical, up-to-date, and accessible review of the field that has always been missing. This literature summary of research at the intersection of economics and marketing is written by, and for, economists, and the book's authors share a belief in analytical and integrated approaches to marketing, emphasizing data-driven, result-oriented, pragmatic strategies. Helps academic and non-academic economists understand recent, rapid changes in the economics of marketing Designed for economists already convinced of the benefits of applying economics tools to marketing Written for those who wish to become quickly acquainted with the integration of marketing and economics
The Routledge Companion to Strategic Marketing
Author: Bodo B. Schlegelmilch
Publisher: Routledge
ISBN: 1351038656
Category : Business & Economics
Languages : en
Pages : 507
Book Description
The Routledge Companion to Strategic Marketing offers the latest insights into marketing strategy. Bodo Schlegelmilch and Russ Winer present 29 specially commissioned chapters, which include up-to-date thinking on a diverse range of marketing strategy topics. Readers benefit from the latest strategic insights of leading experts from universities around the world. Contributing authors are from, among others, the U.S. (Berkeley, Cornell, MIT, New York University, Texas A&M), Europe (the Hanken School of Economics, INSEAD, the University of Oxford, the University of Groningen, WU Vienna) and Asia (the Indian School of Business, Tongji University). The topics addressed include economic foundations of marketing strategy, competition in digital marketing strategy (e.g. mobile payment systems and social media strategy), marketing strategy, and corporate social responsibility, as well as perspectives on capturing the impact of marketing strategy. Collectively, this authoritative guide is an accessible tool for researchers, students, and practitioners.
Publisher: Routledge
ISBN: 1351038656
Category : Business & Economics
Languages : en
Pages : 507
Book Description
The Routledge Companion to Strategic Marketing offers the latest insights into marketing strategy. Bodo Schlegelmilch and Russ Winer present 29 specially commissioned chapters, which include up-to-date thinking on a diverse range of marketing strategy topics. Readers benefit from the latest strategic insights of leading experts from universities around the world. Contributing authors are from, among others, the U.S. (Berkeley, Cornell, MIT, New York University, Texas A&M), Europe (the Hanken School of Economics, INSEAD, the University of Oxford, the University of Groningen, WU Vienna) and Asia (the Indian School of Business, Tongji University). The topics addressed include economic foundations of marketing strategy, competition in digital marketing strategy (e.g. mobile payment systems and social media strategy), marketing strategy, and corporate social responsibility, as well as perspectives on capturing the impact of marketing strategy. Collectively, this authoritative guide is an accessible tool for researchers, students, and practitioners.
The Joint Effects of Brands and Warranties in Signaling New Product Quality
Author: Lydia J. Price
Publisher:
ISBN:
Category : Brand name products
Languages : en
Pages : 54
Book Description
Publisher:
ISBN:
Category : Brand name products
Languages : en
Pages : 54
Book Description
Warranties as Signals of Product Quality when Some Do Not Seek Redress
Author: Edward L. Golding
Publisher:
ISBN:
Category : Consumers
Languages : en
Pages : 36
Book Description
Publisher:
ISBN:
Category : Consumers
Languages : en
Pages : 36
Book Description
Journal of ecnomics and business
Author:
Publisher:
ISBN:
Category :
Languages : en
Pages : 564
Book Description
Publisher:
ISBN:
Category :
Languages : en
Pages : 564
Book Description
A Quality-signaling Rationale for Aftermarket Tying
Author: Marius Schwartz
Publisher:
ISBN:
Category : Aftermarkets
Languages : en
Pages : 34
Book Description
Publisher:
ISBN:
Category : Aftermarkets
Languages : en
Pages : 34
Book Description