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Lecture 4
Empirical Marketing
| Question | Answer |
|---|---|
| How can competitors displace firms? | 1. Technical innovations 2. Exploiting changes in customer desires 3. Better problem solving 4. Copycats that improve the efficiency or effectiveness of an existing execution |
| What is the SCA criteria? | 1. Customers care about what this SCA offers 2. Firm does it better than others- relative advantage 3. The SCA must be hard to duplicate or substitute |
| What are the market based sources of SCA? | -Brands: more effective for consumer goods -Offerings: new product and services -Relationship: more effective for B2B goods |
| What are the barriers to duplicate BOR strategies? | -Brands: image resides in consumer minds, making them difficult to duplicate. Facilitates habitual buying -Offerings: cost benefit, performance advantages, access to distribution channels -Relationships: leads to trust, commitment, interpersonal bond |
| What factors affecting SCA during the pre industrial age? | - Producer is both the marketer and the retailer - sales are to geographically proximate customers |
| What are factors affecting sources of SCA in the industrial revolution? | - Mass production provides economies of scale - More geographically dispersed customers - Emergence of middle men -Large supply creates the need for aggressive sale promotions |
| What are factors affecting SCA during the technology revolution? | - Shift from tangible to digital and knowledge products - Fast technological change and turbulence |
| What are factors affecting SCA during services revolution? | -Disintermediation removes the middleman between producer and consumer -Economy shifts from focus on product to services |
| What is customer equity? | It is analogous to the CLV, the three equities combine in a BOR stack |
| Describe offering equity | the benefits relative to costs of offering stripped of any benefits from brand or relationship - price + performance -big part of total equity for commodity holder Less important for: - services - products that provide status - maturing markets |
| Describe brand equity | - linked to a name or symbol that +/- value from a firm - knowledge of the brand affects behavior - BE lies in the minds of consumers - key for status based offering - better for offerings with large similar groups - hard to adapt or change |
| Describe relationship equity | - social network associated with the offering that +/- value to the firm - relationships affect behavior - relational based decisions is in our psyche - key for b2b, services and complex selling cycles |
| Describe marketing experiments | The test how customer respond to marketing decisions while ruling out confounds that would otherwise be present when comparing a treatment group to a control group |
| When do you use marketing experiments? | - to determine wether there is a direct causal relationship between specific BOR investment and firm outcome - to choose among a set of BOR strategies according to their financial impact |
| What is the process of marketing experiments? | 1. Randomly divide customers into 2 groups 2. Do nothing to 1 group (control group) 3. Do your test to other groups but nothing else (double blind) 4. After some time test the difference in outcomes across groups and see if it varied significantly |
| What does causality imply? | 1. the independent variable and outcome variable co-vary together 2. the independent variable precedes the outcome variable in time 3. alternative explanation for the measured effect can be ruled out |
| What is the problem with causal interference? | Cannot observe both potential outcomes, need random treatment assignment (or quasi random) |
| What is the stable unit value assumption? | Potential outcomes for unit i (y1 and y0) are unaffected by treatment of unit j - No interference across units - Choose units that minimize interference |
| What is internal validity? | Can we estimate treatment effect for our sample? - fails when there's differences between treated + controls that affect the outcome that we can't control Threats: - failure of randomization - non-compliance with experimental protocol - attrition |
| What is external validity? | Can we extrapolate our estimates to other populations? - fails when the treatment effect is different outside he evaluation environment Threats: - representative sample - non-representative program - Hawthorne effects |
Created by:
janasultan
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