The quick answer, yes and no. First the bad news, they are often restricted from purchasing more. If I wanted to patronize my local movie theater or my favorite restaurant more I’m restricted from doing so – that’s not good. However, the good news. My work with Dave Kolar and Michel Laroche found that when consumers were able to patronize the business they gave more than they needed to. They gave in the form of tips. Consumers of a local independent coffee shop were tipping more than they did prior to the pandemic and in the case of an independent movie theater they tipped the staff (usually after coming in to only purchase popcorn) even though they rarely did so before the pandemic. What does this mean for small businesses? Keep the consumer interaction if you can (in a safe way). If consumers can interact with an employee they are more likely to tip now more than ever. It doesn’t offset the losses the small businesses are suffering but it helps. Support for small business during a health crisis – JSR – 2021
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That’s the question I explore in my latest article (Journal of Services Marketing). Using both the home improvement sector and a real estate brokerage I find that things such as word-of-mouth and maintaining a good website can bring in more clients (at a cheaper cost) than actual advertising can. For a home improvement contractor, each time they get a request they need to submit a proposal which is costly. However, a lot of customers that come via this marketing communications channel haven’t narrowed down their company search. If the consumer comes via a word-of-mouth or the website then they likely did their homework on the firm. This means they are more likely to be a paying a customer. Effect of Interactive Marketing Communications Channels on Customer Acquisition – JSM – 2020.
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Last year (2019) both Los Angeles and Washington D.C added more restrictions on Airbnb rentals. Both locations require hosts to only list their primary residence and put a restriction on how long the property can be rented via Airbnb (120 days and 90 days respectively). Toronto is implementing similar regulations in 2020. The rationale behind these regulations is the same as it is for other municipalities which have restricted Airbnb rentals such as Paris, Amsterdam, and San Francisco. They are motivated by the growth of commercial operators, those that buy properties and do not live there but instead renting them as short-term rentals. This situation reduces the supply of affordable housing in the area and as a by-product harms legitimate hosts in the sharing economy. I’ve compiled a summary of regulations from around the world. Summary of Airbnb Regulations Around the World.
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The best cars have the best features, the latest technology, the best gadgets. They’re also priced accordingly. However, our research has found that it’s these cars that lose the greatest amount of value. Technology changes quickly so in a few years if you wanted to sell your used car (or trade it in) the question becomes, why would someone want an older car with older technology when they can pay the same price to buy a new one with updated technology. In short, premium products lose the most value in the secondary market (when they’re sold used). My latest research (along with Cristel Russell of Pepperdine) revealed that the most expensive cars lose the most amount of value. To read more, click here for an advance copy of our paper (Value Dynamics in the Secondary Market June 2019 v2)
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Over half of the first round draft pics in the NFL draft came from schools that were not ranked in the top 10 of the college football rankings. This provides credence to the argument that recruits may be better off going to a smaller school where they can star vs. a larger school where they have to wait to show their skills in a game. This example is the basis of a paper written by my colleague Alex Dunn and I. We examine whether NFL draft pics are more likely to come from top football schools or less reputable football schools. Our results provide evidence to the argument that from a recruiting standpoint, recruits may be better off attending smaller schools.
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