An examination of ongoing trends in airline ancillary revenues

The airline industry seems permanently embedded in producing thin margins and continuously combatting downward pressure on yields. To perpetuate the problem, the industry remains eclipsed with high cost structures and low barriers to entry. However, a new sizzling concept continues to counterbalance these effects in the form of ancillary revenues. Globally, these revenues have increased by 121% from 2010 to 2014 – and the trend is set to continue as carriers are quickly implementing structural changes to accommodate these revenues streams. This paper examines the performance of the two core classifications of ancillary revenues, which are unbundled products and commission based income. It also investigates the willingness of passengers to pay for these services together with what type of ancillary items are acceptable at a particular price point. The study found that passengers value a narrow range of perceived ‘necessity’ products and services such as food and drink, checked baggage and seat assignment as opposed to perceived ‘optional’ unbundled or commission based products/services. It also found significant differences in WTP for specific ancillary services based on carrier type (FSC/LCC/Charter), length of flight (long and short haul) and journey purpose (business, leisure, VFR)

(R)evolution of the E-grocery Industry: Strategic Implications

The use of the Internet in grocery retailing created the need for new business models, but it did not bring radical changes to consumer behaviour. Despite adopting revolutionary business models in their early days, online grocery firms did not manage to survive or reach profitability without using existing supermarket infrastructure and knowledge. Today, with most online grocers supplying small market niches, it is important to understand the reasons that made online grocers adopt a hybrid click and mortar strategy. Historical evidence from online grocery in the UK and the US suggests that firms had to adopt contingent strategies to face the difficulty of attracting consumers, sectorial entry barriers and financial targets.e-grocery, contingency, mismatch, revolution and evolution

Using Transaction Utility Approach for Retail Format Decision

Transaction Utility theory was propounded by Thaler to explain that the value derived by a customer from an exchange consists of two drivers: Acquisition Utilities and Transaction utilities. Acquisition utility represents the economic gain or loss from the transaction. Where as transaction utility is associated with purchase or (sale) and represents the pleasure (or displeasure) of the financial deal per se and is a function of the difference between the selling price and the reference price. Choice of a format has been studied from several dimensions including the cost and effort as well as the non-monetary values. However, the studies that present the complete picture and combine the aspects of the tangible as well as intangible values derived out of the shopping process are limited. Most of the studies, all of them from the developed economies, have focussed on the selection of a store. They represent a scenario where formats have stabilised. However, in Indian scenario formats have been found to be influencing the choice of store as well as orientation of the shoppers. Also, retailers are experimenting with alternate format with differing success rates. The author has also not found a study that has applied this theory. It is felt that the Transactional Utility Theory may provide a suitable approach for making format decisions.

Consumer-driven innovation networks and e-business management systems

This paper examines the use of consumer-driven innovation networks within the UK food-retailing industry using qualitative interview-based research analysed within an economic framework. This perspective revealed that, by exploiting information gathered directly from their customers at point-of-sale and data mining, supermarkets are able to identify consumer preferences and co-ordinate new product development via innovation networks. This has been made possible through their information control of the supply-chain established through the use of transparent inventory management systems. As a result, supermarkets’ e-business systems have established new competitive processes in the UK food-processing and retailing industry and are an example of consumer-driven innovation networks. The informant-based qualitative approach also revealed that trust-based transacting relationships operated differently from those previously described in the literature

THE GROCERY RETAILING SECTOR IN GERMANY: ECR ACTIVITIES IN COMPARISON TO THE USA

The German food retail sector and food manufacturers are in a state of transition due to a complex mix of technological and market forces. Competition continues to increase due to sluggish demand and increasing consumer mobility. The high degree of domestic and international concentration increases the intensity of competition. The top 20 food retailers obtain far more than two-thirds of total sales. Because of the increased competition among retailers, the number of retail stores will continue to decline. Food manufacturers fear the buying power of retailers in many ways. Distrust and struggle over the terms of trade characterize the relation between retailers and manufacturers. ECR activities in Germany lag behind relative to the US due to various cultural and procedural differences as well as strategic reasons. However, ECR provides a catalog of measures to achieve more efficiency and customer focus.Industrial Organization, Marketing,

Psychological elements explaining the consumer's adoption and use of a website recommendation system: A theoretical framework proposal

The purpose of this paper is to understand, with an emphasis on the psychological perspective of the research problem, the consumer's adoption and use of a certain web site recommendation system as well as the main psychological outcomes involved. The approach takes the form of theoretical modelling. Findings: A conceptual model is proposed and discussed. A total of 20 research propositions are theoretically analyzed and justified. Research limitations/implications: The theoretical discussion developed here is not empirically validated. This represents an opportunity for future research. Practical implications: The ideas extracted from the discussion of the conceptual model should be a help for recommendation systems designers and web site managers, so that they may be more aware, when working with such systems, of the psychological process consumers undergo when interacting with them. In this regard, numerous practical reflections and suggestions are presented

An Exploratory Study into the Factors Impeding Ethical Consumption

Although consumers are increasingly engaged with ethical factors when forming opinions about products and making purchase decisions, recent studies have highlighted significant differences between consumers’ intentions to consume ethically, and their actual purchase behaviour. This article contributes to an understanding of this “ethical purchasing gap” through a review of existing literature, and the inductive analysis of focus group discussions. A model is suggested which includes exogenous variables such as moral maturity and age which have been well covered in the literature, together with further impeding factors identified from the focus group discussions. For some consumers, inertia in purchasing behaviour was such that the decision-making process was devoid of ethical considerations. Several manifested their ethical views through post-purchase dissonance and retrospective feelings of guilt. Others displayed a reluctance to consume ethically due to personal constraints, a perceived negative impact on image or quality, or an outright negation of responsibility. Those who expressed a desire to consume ethically often seemed deterred by cynicism, which caused them to question the impact they, as an individual, could achieve. These findings enhance the understanding of ethical consumption decisions and provide a platform for future research in this area

Dual effect of sensory experience: engagement versus diversive exploration

Producción CientíficaPurpose. The objective of this work is to examine the dual effect of sensory experiences on customer behaviour in the context of retailing. Based on the theoretical framework of the optimal stimulation level theory, the authors propose that sensory experiences reinforce satisfaction, engagement, and loyalty, but increase customers’ diversive exploration and curiosity for other experiences and may eventually led to reduced loyalty. Design/methodology/approach. A self-administrated online questionnaire was distributed via email to 1,000 households in a Spanish town, and 325 usable responses of supermarket customers were collected. The hypothesized relationships were tested using the partial least squares approach. The analysis is extended with an experiment in online fashion stores that explores whether a varied sensory experience reinforces consumers’ diversive exploration. Sixty-eight students participated in the study. Hierarchical regression analysis is performed to analyse the results of the experiment. Findings. Findings support the notion that a pleasant sensory experience increases customer satisfaction and therefore their engagement and behavioural loyalty (exclusivity) towards the retailer whilst also generating more ambitious consumer expectations vis-à-vis the shopping experience and thus encouraging them to search for new retailers and, so, to be less loyal. Research implications. This research warns of the risk of increasing customers’ expectations and reducing their loyalty; hence indicating that satisfaction is not enough. Retailers should consider offering new experiences and so surprising customers every so often by attempting to curtail the effect of satiation or over-arousal. Originality/value. The novelty of this study is the proposal of a twofold effect of sensory experience on loyalty; a positive effect, through satisfaction, and a negative effect, through the search for new experiences.Junta de Castilla y León (proyecto VA112P17)Ministerio de Economía, Industria y competitividad (proyecto ECO2017-86628-P

An empirical investigation of antecedents of brand loyalty : the role of product category, marketing mix and consumer related characteristics in the light of niche brands proliferation

Les entreprises investissent de larges sommes dans la fidélisation de leur clientèle. La raison en est simple : les clients fidèles font partie des plus profitables pour les entreprises. Il est donc essentiel de comprendre ce qui amène les consommateurs à être fidèles. La recherche a ainsi considérablement étudié les antécédents de la fidélité à la marque. Ceux-ci peuvent être divisés en trois classes : les antécédents liés à la catégorie de produit, ceux liés au marketing mix du produit et ceux liés au consommateur. Cependant, et malgré l’intérêt des chercheurs pour ces questions, une étude plus approfondie est nécessaire du fait de la mutation des marchés ces dernières décennies. Un des changements les plus marquants est le développement des marques de niche. Le but de cette thèse est ainsi de mieux comprendre ce qui amène les consommateurs à être fidèle à la lumière de ces marques de niche. Nous étudions plus particulièrement les marques bio et de distributeur. Cette thèse comporte quatre études, chacune s’intéressant à une classe particulière d’antécédents. Nos résultats nous permettent, tout d’abord, de réexaminer l’effet de certains antécédents grâce à des données de panel récentes. Ils nous donnent ensuite des indications sur les effets des marques de niche sur la fidélité à la marque. Plus précisément, ils démontrent que le développement des marques de niche a un effet sur la fidélité à un niveau agrégé. De la même façon, on observe un effet modérateur du type de marques de niche sur l’effet de certains antécédents. Nous discutons les implications théoriques, méthodologiques et managériales de ces résultats.Firms invest heavily in building and maintaining relationships with their customers. This is due to loyal customers being among the most profitable ones for firms. It is thus essential for managers and researchers to understand what drives customers to become loyal. Researchers have investigated brand loyalty antecedents at great length. These antecedents can be divided in three classes: product category, marketing mix and customer-related ones. Despite the large body of research on these antecedents, an update is necessary as markets have been changing in the last decades. One of the major changes has been the apparition and proliferation of niche brands (such as organic and private label brands) that are positioned to serve segments of consumers with specific needs. The aim of this Ph.D. research is to fill these gaps and get a better understanding of what influences brand loyalty in the light of niche brands’ development. We specifically focus on two types of niche brands: organic and private label brands. This Ph.D. research is comprised of four studies, each one investigating one class of antecedents. Our results first enable us to reassess the effect of certain antecedents of brand loyalty using recent panel purchase data. It also gives us some insights on the role of niche brands. It shows that the proliferation of niche brands and more specifically the proliferation of private label brands has an effect on brand loyalty at an aggregate level. In the same way, niche brands have a moderating effect on the impact of some antecedents of brand loyalty. Theoretical, methodological and managerial implications of these findings are discussed

An empirical investigation of antecedents of brand loyalty : the role of product category, marketing mix and consumer related characteristics in the light of niche brands proliferation

Les entreprises investissent de larges sommes dans la fidélisation de leur clientèle. La raison en est simple : les clients fidèles font partie des plus profitables pour les entreprises. Il est donc essentiel de comprendre ce qui amène les consommateurs à être fidèles. La recherche a ainsi considérablement étudié les antécédents de la fidélité à la marque. Ceux-ci peuvent être divisés en trois classes : les antécédents liés à la catégorie de produit, ceux liés au marketing mix du produit et ceux liés au consommateur. Cependant, et malgré l’intérêt des chercheurs pour ces questions, une étude plus approfondie est nécessaire du fait de la mutation des marchés ces dernières décennies. Un des changements les plus marquants est le développement des marques de niche. Le but de cette thèse est ainsi de mieux comprendre ce qui amène les consommateurs à être fidèle à la lumière de ces marques de niche. Nous étudions plus particulièrement les marques bio et de distributeur. Cette thèse comporte quatre études, chacune s’intéressant à une classe particulière d’antécédents. Nos résultats nous permettent, tout d’abord, de réexaminer l’effet de certains antécédents grâce à des données de panel récentes. Ils nous donnent ensuite des indications sur les effets des marques de niche sur la fidélité à la marque. Plus précisément, ils démontrent que le développement des marques de niche a un effet sur la fidélité à un niveau agrégé. De la même façon, on observe un effet modérateur du type de marques de niche sur l’effet de certains antécédents. Nous discutons les implications théoriques, méthodologiques et managériales de ces résultats.Firms invest heavily in building and maintaining relationships with their customers. This is due to loyal customers being among the most profitable ones for firms. It is thus essential for managers and researchers to understand what drives customers to become loyal. Researchers have investigated brand loyalty antecedents at great length. These antecedents can be divided in three classes: product category, marketing mix and customer-related ones. Despite the large body of research on these antecedents, an update is necessary as markets have been changing in the last decades. One of the major changes has been the apparition and proliferation of niche brands (such as organic and private label brands) that are positioned to serve segments of consumers with specific needs. The aim of this Ph.D. research is to fill these gaps and get a better understanding of what influences brand loyalty in the light of niche brands’ development. We specifically focus on two types of niche brands: organic and private label brands. This Ph.D. research is comprised of four studies, each one investigating one class of antecedents. Our results first enable us to reassess the effect of certain antecedents of brand loyalty using recent panel purchase data. It also gives us some insights on the role of niche brands. It shows that the proliferation of niche brands and more specifically the proliferation of private label brands has an effect on brand loyalty at an aggregate level. In the same way, niche brands have a moderating effect on the impact of some antecedents of brand loyalty. Theoretical, methodological and managerial implications of these findings are discussed