E-loyalty networks in online auctions

Creating a loyal customer base is one of the most important, and at the same time, most difficult tasks a company faces. Creating loyalty online (e-loyalty) is especially difficult since customers can ``switch'' to a competitor with the click of a mouse. In this paper we investigate e-loyalty in online auctions. Using a unique data set of over 30,000 auctions from one of the main consumer-to-consumer online auction houses, we propose a novel measure of e-loyalty via the associated network of transactions between bidders and sellers. Using a bipartite network of bidder and seller nodes, two nodes are linked when a bidder purchases from a seller and the number of repeat-purchases determines the strength of that link. We employ ideas from functional principal component analysis to derive, from this network, the loyalty distribution which measures the perceived loyalty of every individual seller, and associated loyalty scores which summarize this distribution in a parsimonious way. We then investigate the effect of loyalty on the outcome of an auction. In doing so, we are confronted with several statistical challenges in that standard statistical models lead to a misrepresentation of the data and a violation of the model assumptions. The reason is that loyalty networks result in an extreme clustering of the data, with few high-volume sellers accounting for most of the individual transactions. We investigate several remedies to the clustering problem and conclude that loyalty networks consist of very distinct segments that can best be understood individually.Comment: Published in at http://dx.doi.org/10.1214/09-AOAS310 the Annals of Applied Statistics (http://www.imstat.org/aoas/) by the Institute of Mathematical Statistics (http://www.imstat.org

Reconciling visions and realities of virtual working: findings from the UK chemicals industry

The emergence of advanced technologies such as Grid computing will, some suggest, allow the final realisation of visions of virtual organisations. This will, according to its advocates, have entirely positive impacts, creating communities of experts, increasing flexibility, reducing the need for travel and making communications more efficient by crossing boundaries of time and space. Such predictions about future patterns of virtual working are, unfortunately, rarely grounded in real working practices, and often neglect to account for both the rich and varied interpretations that may exist of what constitutes virtual working and the constraints and concerns of those who would do it. This chapter gives attention to the consequences of different views over what virtuality might mean in practice and, in particular, considers virtuality in relation to customer and supplier relationships in a competitive and commercial context. The discussion is based upon a three year study that investigated contrasting visions of what was technically feasible and might be organisationally desirable in the UK Chemicals industry. Through interviews with managers and staff of companies both large and small that research provided insights into the different meanings that organisations attribute to the virtuality of work and to the acceptability of potential implementations of a middleware technology. It was found that interpretations of virtuality amongst the potential users and participants were strongly influenced by established work practices and by previous experiences of relationships-at-a-distance with suppliers and customers. There was a sharp contrast with the enthusiastic visions of virtual working that were already being encapsulated in the middleware by the technical developers; visions of internet-only interaction were perceived as rigid, alienating from well-established ways of working with suppliers and customers and unworkable. In this chapter we shall capture these differences by making a distinction amongst compet

Learning and Governance in Inter-Firm Relations

This article connects theory of learning with theory of governance, in the context of inter-firm relations.It recognizes fundamental criticism of transaction cost economics (TCE), but preserves elements from that theory.Two kinds of relational risk are identified: hold-up and spillover risk.For the governance of relations, i.e. the control of relational risk, the article presents a set of instruments that includes trust, next to instruments adopted and adapted from TCE.It also includes roles for gobetweens.Some references to empirical evidence are included.Inter-firm alliances;learning;transaction costs;governance

Sustainability and certification in the biofuels sector: some critical observations

The society at large demand sustainable production of products often defined in terms of the planet, profit and people categories. Many industrial sectors started to internalize sustainability in their company processes. Public policies underscored these initiatives by giving incentives to raise awareness, support initiatives and disseminate the value of sustainability. In the last decade initiatives came to life to connect confidence, trust and sustainability in the agri- fuel- and food industry. One of the more interesting attempts are Round Tables for sustainable production of palm oil, forest exploitation, biofuels, sugar or soybean. However, are the results positive. Some of these initiatives seem more successful than others. The question is why? How can one interpret these initiatives in terms of performance, structure and governance mechanisms? Based on a comparison of several of these initiatives, conclusions are drawn and hypotheses defined. More in particular, the observations focus on network development, weaknesses in the governance structures, ambivalence in the public domain and the resulting societal confusion

Local and Global Trust Based on the Concept of Promises

We use the notion of a promise to define local trust between agents possessing autonomous decision-making. An agent is trustworthy if it is expected that it will keep a promise. This definition satisfies most commonplace meanings of trust. Reputation is then an estimation of this expectation value that is passed on from agent to agent. Our definition distinguishes types of trust, for different behaviours, and decouples the concept of agent reliability from the behaviour on which the judgement is based. We show, however, that trust is fundamentally heuristic, as it provides insufficient information for agents to make a rational judgement. A global trustworthiness, or community trust can be defined by a proportional, self-consistent voting process, as a weighted eigenvector-centrality function of the promise theoretical graph

On Their Own Ground: Strategies of Resistance for Sunni Muslim Women

Drawing from work in feminist moral philosophy, Tobin argues that the most common methodology used in practical ethics is a questionable methodology for addressing practical problems across diverse cultural contexts because the kind of impartiality it requires is neither feasible nor desirable. She then defends an alternative methodology for practical ethics in a global context and uses her proposed methodology to evaluate a problem that confronts many Sunni Muslim women around the world

Reasoning about Uncertain Information and Conflict Resolution through Trust Revision

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