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Business-to-business (B2B) practitioners are increasingly interested in capabilities to holistically manage touchpoints along B2B customer journeys (CJs) to remain competitive. Research in the B2B context, however, has investigated neither what constitutes such a customer journey management capability (CJMC) nor how, whether, or when it creates value. Taking a mixed-methods approach, we conceptualize and operationalize B2B CJMC as a supplier's ability to achieve superior customer value along the B2B CJ by strategically creating value-anchored customer touchpoints characterized through the implementation of consistent resource usage across internal organizational boundaries and by continuously monitoring value creation toward the individual members of the buying center. Analyzing a multisource dataset, we provide evidence that B2B CJMC has an indirect effect on firm performance (i.e., return on sales) through two opposing mechanisms (i.e., customer loyalty and customer-related coordination costs). Importantly, using survey and archival data, we show that, overall, B2B CJMC has a significant and positive impact on firm performance through the two mechanisms. Finally, these underlying mechanisms are also prevalent when testing for the moderating factors switching costs, number of touchpoints, and product versus service., Author(s): Christian Homburg [sup.1] [sup.2] , Moritz Tischer [sup.1] Author Affiliations: (1) grid.5601.2, 0000 0001 0943 599X, Marketing Department, University of Mannheim, , 68131, Mannheim, Germany (2) grid.5379.8, 0000000121662407, Alliance [...]

Complex services, such as healthcare, struggle to realize the benefits of value co-creation due to the substantial challenges of managing such services over the long-term. Key to overcoming these challenges to value co-creation is a profound understanding of dialogue (i.e., 'quality of discourse' facilitating shared meaning) during service interactions. Contributing to an emerging literature, we undertake a longitudinal, ethnographic study to assess dialogue between professionals and patients through the lens of dialogic engagement (i.e., iterative mutual learning processes that bring about action through dialogue). We develop and empirically support six dialogic co-creation and co-destruction mechanisms that impact on the resolution of tensions and integration of knowledge resources between service providers and consumers. We reveal the multidimensional and dynamic nature of value created or destroyed through these mechanisms in dialogue over time. Taking healthcare as an exemplar, we offer a research agenda for developing our understanding of DE in complex services., Author(s): Debbie Isobel Keeling [sup.1] , Kathleen Keeling [sup.2] , Ko de Ruyter [sup.3] [sup.4] , Angus Laing [sup.5] Author Affiliations: (1) grid.12082.39, 0000 0004 1936 7590, University of Sussex [...]

Although social media use is gaining increasing importance as a component of firms' portfolio of strategies, scant research has systematically consolidated and extended knowledge on social media marketing strategies (SMMSs). To fill this research gap, we first define SMMS, using social media and marketing strategy dimensions. This is followed by a conceptualization of the developmental process of SMMSs, which comprises four major components, namely drivers, inputs, throughputs, and outputs. Next, we propose a taxonomy that classifies SMMSs into four types according to their strategic maturity level: social commerce strategy, social content strategy, social monitoring strategy, and social CRM strategy. We subsequently validate this taxonomy of SMMSs using information derived from prior empirical studies, as well with data collected from in-depth interviews and a quantitive survey among social media marketing managers. Finally, we suggest fruitful directions for future research based on input received from scholars specializing in the field., Author(s): Fangfang Li [sup.1] , Jorma Larimo [sup.1] , Leonidas C. Leonidou [sup.2] Author Affiliations: (1) grid.19397.35, 0000 0001 0672 2619, School of Marketing and Communication, University of Vaasa, , [...]

Extant research examining interpersonal trust in business-to-business (B2B) buyer-seller relationships focuses on its multidimensionality, mainly from a business perspective. Our research captures an element of business relationships that is heretofore under-examined: the personal side of the relationship between the buyer and seller. We examine the interplay between both business and personal trust on performance in the relationship, namely analyzing customer relationship satisfaction and customer loyalty. We also test our model using perceived market turbulence as a moderating variable since turbulence in the marketplace could strain the relationship between the buyer and seller and affect the strength of the statistical relationships between business and personal trust on performance in the relationship., Author(s): Stephanie M. Mangus [sup.1] , Eli Jones [sup.2] , Judith Anne Garretson Folse [sup.3] , Shrihari Sridhar [sup.4] Author Affiliations: (1) grid.252890.4, 0000 0001 2111 2894, Hankamer School of [...]

Although brands increasingly disseminate their brand biographies through brand sources, this research shows that this practice can decrease brand attitudes and consumer preferences. A brand source activates consumers' persuasion knowledge, increasing negative thoughts and impeding narrative transportation into the brand biography. This research furthermore demonstrates that the negative impact of a brand source in the dissemination of brand biographies depends on self-congruence, such that a detrimental effect on consumer attitudes and preferences occurs when the brand biography is incongruent with consumer's self-concept, but is mitigated when the brand biography is self-congruent. These findings suggest that the dissemination of brand biographies by brand sources requires consideration of source and congruence effects., Author(s): Ali Tezer [sup.1] , H. Onur Bodur [sup.2] , Bianca Grohmann [sup.3] Author Affiliations: (1) grid.256696.8, 0000 0001 0555 9354, Department of Marketing, HEC Montréal, , 3000 chemin de [...]

How many customers can we expect? As of May 2020, 33 million Americans were unemployed. U.S. weekly jobless claims jumped to 6.6 million in the first week of April alone. [...]

We study how digital service firms can develop an active customer base, focusing on two questions. First, how does the way that customers use the service postadoption to meet their own needs (personal usage) and to interact with one another (social usage) vary across customer acquisition methods? Second, how do firm-to-customer and customer-to-customer communications promote different types of usage? We study these questions using two data sets and by developing a multivariate hierarchical Poisson hidden Markov model (HMM), which fits the data significantly better than univariate and latent class approaches. We indeed find that postadoption behavior varies depending on customer acquisition method and dynamic states. At the total usage level, in one context (an annotation and note-taking service), customers who heard about the service through search and mass-invite exhibited significantly higher usage compared to those who joined through word of mouth (WOM), whereas in another context (a cloud-based file storage service), customers who joined through WOM referrals tended to exhibit higher usage. Yet, examining how routes of adoption relate to specific types of behavior, personal versus social usages, reveals a more nuanced picture. Furthermore, in both contexts, communications postadoption influenced engagement, albeit in different ways. Firm-to-customer communications, through company posts to Twitter and blog entries, had varying effects on customer behavior and in some cases led to lower personal and/or social usage; however, customer-to-customer communications tended to increase personal-use engagement across latent states and in both data sets. The findings suggest that firms offering digital services should pay attention to how the mode of customer acquisition is related to subsequent usage intensity, accounting for both personal and social activity, and encourage customers to interact with each other postadoption. History: Accepted by Pradeep Chintagunta, marketing. Supplemental Material: The online technical appendix is available at https://doi.org/10.1287/ mnsc.2017.2754. Keywords: customer engagement * adoption routes * hidden Markov models * search * word of mouth * digital marketing * Bayesian estimation * social influence * web services * social apps, 1. Introduction Over the past decade many digital companies, including industry giants Google, Facebook, and Microsoft, as well as entrepreneurial firms like Evernote and Wix, have begun hosting a significant [...]

This research examines the increasing use of online customer reviews in business-to-business (B2B) decision making. In contrast with other research on B2B decision making, we study a unique aspect wherein buyers draw on two sources: external reviews posted on online professional communities and internal reviews in the format of vendor scorecards. This method creates a conundrum: What happens when a buyer is confronted with conflicting reviews from two different sources? To shed light on this problem, we (1) interviewed 48 B2B buyers, (2) conducted a field experiment with 293 B2B buyers to examine the effect of review source, (3) conducted a second field experiment with 587 B2B buyers to examine the effect of conflicting reviews, and (4) solicited insights from 82 B2B buyers regarding the findings. The results indicate that B2B buyers are driven to resolve differences in reviews rather than to dismiss negative reviews. In addition, even positive internal reviews prompt exploration to confirm that relational bias is not present., Author(s): Michelle D. Steward [sup.1] , James A. Narus [sup.2] , Michelle L. Roehm [sup.1] Author Affiliations: (1) Wake Forest University, 0000 0001 2185 3318, grid.241167.7, , 27109-7285, Winston-Salem, NC, [...]

This paper studies the strategy of sharing inventory information for a Arm that sells two vertically differentiated products. The seller has private information on the aggregate inventory level and the inventory composition of two product variants. The seller credibly and discretionarily discloses inventory information to customers either fully or partially, i.e., disclosing the exact inventory of each product variant, the aggregate inventory level, or no information to customers. Customers form expectations of future availability and make rational purchasing decisions accordingly. In the disclosure literature, discretion usually leads to an unraveling result: sellers who learn favorable market information opt to disclose it, making full disclosure the equilibrium. This paper shows that aggregate inventory disclosure, i.e., partial disclosure, can be instead sustained as an ex post equilibrium. We demonstrate that inventory information aggregation arises when there is an ex post desire to reduce supply-demand mismatches in all inventory scenarios. Specifically, when customers' preferred products are more likely to stock out, the seller could entice more incoming consumers who hope that their desired products are in stock by withholding product composition but disclosing the aggregate inventory level. If customers' desired products are sold out, the seller can benefit from upselling or cross-selling customers' less preferred products. Alternatively, when the seller stocks more desired products, aggregate disclosure can dampen the flow of incoming customers and reduce the shortage penalty cost. This result is robust under various settings: risk-averse customers, heterogeneous customers, and horizontally differentiated products. History: Accepted by Serguei Netessine, operations management. Keywords: information aggregation * inventory information disclosure * cross-selling * product variety, 1. Introduction The advent of the Internet and information system technologies has enabled companies to share various kinds of information with customers at a much lower cost, e.g., inventory information [...]

Manufacturers invest in customer solutions to differentiate their offerings and sustain profitability despite declining margins from goods sales. Notwithstanding strong managerial and academic interest, an examination of whether and explanations for when and why solutions translate into superior performance are lacking. We test hypotheses developed from the resource-based theory and transaction cost economics, supplemented with in-depth theory-in-use interviews, on primary and secondary data collected from 175 manufacturers. From a model that corrects for endogeneity, the findings suggest that, compared with other service offerings, solutions are associated with increased return on sales. This positive profitability effect is enhanced in firms with greater sales capabilities; it is stronger in industries with greater buyer power but weaker in technology-intensive industries. These results caution against the simplistic view of solutions as a universal route to gaining competitive advantage and aid in better identifying the role of solutions in a manufacturer's offering portfolio., Author(s): Stefan Worm [sup.1] , Sundar G. Bharadwaj [sup.2] , Wolfgang Ulaga [sup.3] , Werner J. Reinartz [sup.4] Author Affiliations: (1) 0000 0001 2361 9429grid.413074.5BI Norwegian Business School, Department of [...]

The customer value proposition (CVP) has a critical role in communicating how a company aims to provide value to customers. Managers and scholars increasingly use CVP terminology, yet the concept remains poorly understood and implemented; relatively little research on this topic has been published, considering the vast breadth of investigations of the value concept. In response, this article offers a comprehensive review of fragmented CVP literature, highlighting the lack of a strong theoretical foundation; distinguishes CVPs from related concepts; proposes a conceptual model of the CVP that includes antecedents, consequences, and moderators, together with several research propositions; illustrates the application of the CVP concept to four contrasting companies; and advances a compelling agenda for research., Author(s): Adrian Payne [sup.1] , Pennie Frow [sup.2] , Andreas Eggert [sup.3] Author Affiliations: (1) 0000 0004 4902 0432grid.1005.4School of Marketing, UNSW Business School, University of New South Wales, UNSW, [...]

Author(s): Michael Ahearne [sup.1] Author Affiliations: (1) Bauer College of Business, 4750 Calhoun Road, Room 334, 77204-6021, Houston, TX, USA In V. Kumar's editorial, 'The Role of University Research Centers [...]

We investigate whether organizations can create value by introducing visual transparency between consumers and producers. Although operational transparency has been shown to improve consumer perceptions of service value, existing theory posits that increased contact between consumers and producers may diminish work performance. Two field and two laboratory experiments in food service settings suggest that transparency that (1) allows customers to observe operational processes (process transparency) and (2) allows employees to observe customers (customer transparency) not only improves customer perceptions but also increases service quality and efficiency. The introduction of this transparency contributed to a 22.2% increase in customer-reported quality and reduced throughput times by 19.2%. Laboratory studies revealed that customers who observed process transparency perceived greater employee effort and thus were more appreciative of the employees and valued the service more. Employees who observed customer transparency felt that their work was more appreciated and more impactful and thus were more satisfied with their work and more willing to exert effort. We find that transparency, by visually revealing operating processes to consumers and beneficiaries to producers, generates a positive feedback loop through which value is created for both parties. History: Accepted by Serguei Netessine, operations management. Funding: This research was supported by Harvard Business School and University College London. Supplemental Material: Data and the online appendix are available at https://doi.org/10.1287/mnsc.2015.2411. Keywords: labor * inventory production * organizational studies * behavior * operational transparency * service design, 1. Introduction At the local Krispy Kreme store, freshly glazed donuts move along on conveyer belts behind glass panes, beckoning customers to observe their production. From fast-food chains such as [...]

Customer engagement marketing-defined as a firm's deliberate effort to motivate, empower, and measure customer contributions to marketing functions-marks a shift in marketing research and business practice. After defining and differentiating engagement marketing, the authors present a typology of its two primary forms and offer tenets that link specific strategic elements to customer outcomes and thereby firm performance, theorizing that the effectiveness of engagement marketing arises from the establishment of psychological ownership and self-transformation. The authors provide evidence in support of the derived tenets through case illustrations, as well as a quasi-experimental field test of the central tenet of engagement marketing., Author(s): Colleen M. Harmeling [sup.1] , Jordan W. Moffett [sup.2] , Mark J. Arnold [sup.3] , Brad D. Carlson [sup.3] Author Affiliations: (1) 0000 0004 0472 0419grid.255986.5Florida State University, 821 [...]

Increasingly, knowledgeable business-to-business (B2B) customers and evolving customer needs are leading to seismic shifts in vendor-client interactions. Across industries, sellers are changing their business models from a simple goods orientation to a hybrid goods-services model, placing greater emphasis on delivering complete customer solutions. In such an environment, companies must find ways to prioritize investments in resource development. The service-dominant (S-D) logic framework offers significant insights into this challenge; however, these effects have not been tested quantitatively. This study addresses that gap, examining the influence of various seller resources on buyer satisfaction. An empirical analysis of buying organizations that purchased and implemented business intelligence systems finds that 'augmented' operant resources that the buyers ascribe to the software's sellers-resources that go above and beyond expectations-are the most significant predictors of both successful technology assimilation and overall customer relationship quality. In particular, an augmented operant resource reflecting a seller's ability to see value creation opportunities from the buyer's perspective (value mindset) has up to three times the effect on relationship satisfaction as 'core' operant resources such as product-specific expertise or basic interpersonal service skills. These results can help sellers prioritize resource investments., Author(s): Anthony J. deLeon [sup.1] , Sharmila C. Chatterjee [sup.2] Author Affiliations: (1) grid.441378.dGolden Gate University, San Francisco, CA, USA (2) 0000 0001 2341 2786grid.116068.8Management Science - Marketing, MIT Sloan [...]

In this study, we highlight the need and develop a framework for customer engagement (CE) by reviewing the marketing literature and analyzing popular press articles. By understanding the evolution of customer management, we develop the theory of engagement, arguing that when a relationship is satisfying and has emotional connectedness, the partners become engaged in their concern for each other. As a result, the components of customer engagement include both the direct and the indirect contributions of CE. Based on the theoretical support, our proposed framework elaborates on the components of CE as well as the antecedents (satisfaction and emotion) and consequences (tangible and intangible outcomes) of CE. We also discuss how convenience, nature of the firm (B2B vs. B2C), type of industry (service vs. product), value of the brand (high vs. low), and level of involvement (high vs. low) moderate the link between satisfaction and direct contribution, and between emotions and indirect contribution of CE, respectively. Further, we show how customer engagement can be gained and how firm performance can be maximized by discussing relevant strategies., Author(s): Anita Pansari [sup.1] , V. Kumar [sup.1] Author Affiliations: (1) 0000 0004 1936 7400grid.256304.6Center for Excellence in Brand and Customer Management, J. Mack Robinson College of Business, Georgia State [...]

Author(s): Rajkumar Venkatesan [sup.1] Author Affiliations: (1) 0000 0000 9136 933Xgrid.27755.32Ronald Trzcinski Professor of Business Administration, Darden School of Business, University of Virginia, Charlottesville, VA, USA Introduction The relationships between [...]

Many service systems use case managers, servers who are assigned multiple customers and have frequent, repeated interactions with each customer until the customer's service is completed. Examples may be found in healthcare (emergency department physicians), contact centers (agents handling multiple online chats simultaneously) and social welfare agencies (social workers with multiple clients). We propose a stochastic model of a baseline case-manager system, formulate models that provide performance bounds and stability conditions for the baseline system, and develop two approximations, one of which is based on a two-time-scale approach. Numerical experiments and analysis of the approximations show that increasing case throughput by increasing the probability of case completion can lead to much greater waiting-time reductions than increasing service speed. Many systems place an upper limit on the number of customers simultaneously handled by each case manager. We examine the impact of these caseload limits on waiting time and describe effective, heuristic methods for setting these limits. History: Accepted by Yossi Aviv, operations management. Funding: This research was partly funded by the Canadian Natural Sciences and Engineering Research Council [Discovery Grant 203534]. This support is gratefully acknowledged. Supplemental Material: The online appendix is available at https://doi.org/10.1287/mnsc.2015.2368. Keywords: queues * approximations * networks * applications * healthcare * hospitals, 1. Introduction Many service systems employ case managers: customer service agents in a contact center who manage multiple online chats at once, parole officers and social workers who meet with [...]

For many consumer-intensive (i.e., business-to-consumer) services, delivering memorable customer experiences is a source of competitive advantage. Yet there are few guidelines available for designing service encounters with a focus on customer satisfaction. In this paper, we show how experiential services should be sequenced and timed to maximize the satisfaction of customers who are subject to memory decay and acclimation. We find that memory decay favors positioning the highest service level near the end, whereas acclimation favors maximizing the gradient of service level. Together, they maximize the gradient of service level near the end. Although memory decay and acclimation lead to the same design individually, they can act as opposing forces when considered jointly. Overall, our analysis suggests that short experiences should have activities scheduled as a crescendo and duration allocated primarily to the activities with the highest service levels, whereas long experiences should have activities scheduled in a U-shaped fashion and duration allocated primarily to activities with the lowest service level so as to ensure a steep gradient at the end. Keywords: service design; experience; scheduling; social psychology; behavioral operations History: Received September 14, 2013; accepted January 21, 2015, by Serguei Netessine, operations management. Published online in Articles in Advance September 11, 2015., 1. Introduction As epitomized by Walt Disney's entertainment parks and Benihana's restaurants, firms that deliver outstanding customer experiences achieve greater customer satisfaction and therefore greater customer loyalty (Voss and Zomerdijk [...]

We study the effects of customer recognition and behavior-based price discrimination (BPD) in a two-period experience good duopoly with a discrete value distribution, and we investigate the role of consumers ex ante valuation uncertainty in dynamic price competition through comparison with an inspection good duopoly. Several results are reached. First, the firms may reward repeat purchase when the probability of a high value is relatively low and when the high-low value difference is large; otherwise, they may engage in poaching. Second, BPD frequently increases each firm's total profits, even in the poaching equilibrium. These results contrast with the inspection good duopoly, and the driver is that consumers' period 2 product preference depends on their realized values in period 1. Third, consumers' ex ante valuation uncertainty may increase or decrease firm profits without BPD, and it weakly increases firm profits with BPD, relative to the inspection good duopoly. Keywords: behavior-based price discrimination; customer recognition; experience goods; inspection goods History: Received April 11, 2013; accepted September 4, 2014, by J. Miguel Villas-Boas, marketing. Published online in Articles in Advance April 10, 2015., 1. Introduction In many product and service markets, a consumer does not discern her precise value of the good before actual consumption. We examine behavior-based price discrimination (BPD) enabled by [...]

Firms are increasingly engaging with customers on social media. Despite this heightened interest, guidance for effective engagement is lacking. In this study, we investigate customers' compliments and complaints and firms' [...]

Consumers often consider delaying a purchase strategically, anticipating that prices might decrease. Combining two unique data sources from the air-travel industry (posted fare data and booking data), we use a structural model to estimate the fraction of strategic consumers in the population, assuming different levels of sophistication in consumers' perception of future prices: perfect foresight and weak- and strong-form rational expectations. We find that 5.2% to 19.2% of the population is strategic across markets, measured by the first and third quartiles. Our intermarket analysis indicates that shorter trips with more attractive outside options are populated with more strategic consumers. Using a nonparametric approach, we further find that most strategic consumers arrive either at the beginning of the booking horizon or close to departure. Finally, our counterfactual analysis shows that, contrary to conventional wisdom, the presence of strategic consumers does not necessarily hurt revenues. Rather, the impact varies by market. Commitment to a nondecreasing pricing strategy is more likely to benefit business markets than leisure markets, or it could even hurt leisure markets. Intermarket analysis shows that city pairs with lower Internet penetration, higher average price, and shorter distances tend to benefit more from such commitment as well. Keywords: econometrics; structural estimation; air travel; strategic customer behavior History: Received October 8, 2011; accepted September 22, 2013, by Yossi Aviv, operations management. Published online in Articles in Advance March 20, 2014., 1. Motivation When was the last time you passed on an immediate purchase to wait for a sale? This can be a smart choice because intertemporal price fluctuations are common [...]

This article assesses the financial contribution of marketing capability. In contrast with previous research, which conceptualizes marketing capability as the deployment of marketing resources to achieve sales, this study conceives marketing capability as the deployment of marketing resources to achieve the ultimate objectives of customer satisfaction and brand equity (i.e., customer-oriented marketing capability [COMC]). Thus, this research disentangles the dynamic relationships among marketing resources, sales, customer satisfaction, and brand equity through the use of network Data Envelopment Analysis to capture COMC. According to what the value relevance perspective proposes, COMC positively influences the growth of Tobin's q and improves the growth of analysts' recommendations. These findings remain robust and consistent with the use of additional measures and methods common to the marketing and financial literatures. Our study provides tools and a framework for analysis for managers to maximize their ability to use marketing strategy to drive performance. Keywords Customer-oriented marketing capability * Tobin's q * Analyst recommendations * Network data envelopment analysis, How marketing capabilities influence business performance is one of the key areas of concern for marketing academics and practitioners, as the Marketing Science Institute's (2012)research priorities demonstrate. A key topic [...]

We study the problem faced by a supplier deciding how to dynamically allocate limited capacity among a portfolio of customers who remember the fill rates provided to them in the past. A customer's order quantity is positively correlated with past fill rates. Customers differ from one another in their contribution margins, their sensitivities to the past, and in their demand volatilities. By analyzing and comparing policies that ignore goodwill with ones that account for it, we investigate when and how customer memory effects impact supplier profits. We develop an approximate dynamic programming policy that dynamically rationalizes the fill rates the firm provides to each customer. This policy achieves higher rewards than margin-greedy and Lagrangian policies and yields insights into how a supplier can effectively manage customer memories to its advantage. Key words: dynamic programming; approximate; behavioral operations; customer relationship management; capacity allocation History: Received January 10, 2012; accepted July 17, 2012, by Martin Lariviere, operations management. Published online in Articles in Advance December 19, 2012., 1. Introduction Whenever a firm doing business with a handful of customers (or customer segments) faces more demand than it can supply, it faces a tough choice. On the one [...]

Past research has shown how outcomes in interorganizational relationships are influenced by the characteristics of the individual relationship in question. Focusing on relationships between suppliers and their organizational buyers, we augment this perspective by positing that relationship outcomes are also influenced by social comparison processes involving perceptions of a supplier's practices across comparable buyer relationships. Based on past research on embedded ties and institutional theory, we propose that the effect of these comparison processes depends on the nature of a buyer's existing interorganizational ties and on the norms that are brought to bear on the relationship in question. We test our propositions based on 788 observations of organizational buyers who have relationships with the same supplier. Our findings paint a complex, multilevel picture of the process by which relationship outcomes come about in interorganizational networks. Key words: organizational studies; design, effectiveness performance; strategy; information History: Received July 1, 2010; accepted August 24, 2011, by Jesper Sorensen, organizations. Published online in Articles in Advance February 10, 2012., 1. Introduction A firm's management of its relationships with external partners, such as downstream organizational buyers and upstream suppliers, is an integral part of its overall strategy (Jones et al. [...]

We consider an M/M/1 queueing system with impatient consumers who observe the length of the queue before deciding whether to buy the product. The product may have high or low quality, and consumers are heterogeneously informed. The firm chooses a slow or (at a cost) a fast service rate. In equilibrium, informed consumers join the queue if it is below a threshold. The threshold varies with the quality of the good, so an uninformed consumer updates her belief about quality on observing the length of the queue. The strategy of an uninformed consumer has a 'hole': she joins the queue at lengths both below and above the hole, but not at the hole itself. We show that if the prior probability the product has high quality and the proportion of informed consumers are both low, a high-quality firm may select a slower service rate than a low-quality firm. The queue can therefore be a valuable signaling device for a high-quality firm. Strikingly, in some scenarios, the high-quality firm may choose the slow service rate even if the technological cost of speeding up is zero. Key words: games group decisions; stochastic; probability; stochastic model applications; queues; birth death History: Received April 6, 2010; accepted August 17, 2011, by Assaf Zeevi, stochastic models and simulation. Published online in Articles in Advance December 2, 2011., 1. Introduction Consumers frequently have to wait before they can consume a product or service. Lines outside night-clubs, rides at amusement parks, and waiting lists for new products are part [...]

We study an order promising problem in a multiclass, available-to-promise (ATP) assembly system in the presence of pseudo orders. A pseudo order refers to a tentative customer order whose attributes, such as the likelihood of an actual order, order quantity, and confirmation timing, can change dynamically over time. A unit demand from any class is assembled from one manufactured unit and one inventory unit, where the manufactured unit takes one unit of capacity and needs a single period to produce. An accepted order must be filled before a positive delivery lead time. The underlying order acceptance decisions involve trade-offs between committing resources (production capacity and component inventory) to low-reward firm orders and reserving resources for high-reward orders. We develop a Markov chain model that captures the key characteristics of pseudo orders, including demand lumpiness, nonstationarity, and volatility. We then formulate a stochastic dynamic program for the ATP assembly system that embeds the Markov chain model as a short-term forecast for pseudo orders. We show that the optimal order acceptance policy is characterized by class prioritization, resource-imbalance-based rationing, and capacity-inventory-demand matching. In particular, the rationing level for each class is determined by a critical value that depends on the resource imbalance level, defined as the net difference between the production capacity and component inventory levels. Extensive numerical tests underscore the importance of the key properties of the optimal policy and provide operational and managerial insights on the value of the short-term demand forecast and the robustness of the optimal policy. Key words: available-to-promise; pseudo orders; Markov; stochastic dynamic programming; prioritization; resource and demand matching; resource-imbalance-based rationing; short-term and long-term forecasts; robustness History: Received January 22, 2009; accepted June 22, 2011, by Martin Lariviere, operations management. Published online in Articles in Advance November 4, 2011., 1. Introduction In pursuing sales of higher-value products, it is coammon for sales personnel to closely track and classify the status of 'prospects.' In many cases, the information maintained on [...]

In this paper, we address the problem of making optimal product offers to customers of a retail bank by using techniques including Markov chains, genetic algorithms, mathematical programming, and design [...]

The article recommends four uses for new media: communicating a clearly defined customer promise, creating trust via delivering on the promise, regularly improving on the promise, and innovating past what is familiar.

Steps are presented for addressing attacks on corporate public image. These include responding promptly, avoiding disproportionate displays of force, empowering employees to present the firm's position, and stockpiling credentials to bolster credence.

The article emphasizes the importance of personal contact with customers and suppliers, and providing opportunities for both groups to offer feedback to the company. The French fragrance and jewelry company Boucheron is used to illustrate this concept.

The article identifies and illustrates the four steps to customer participation in process design, also known as the co-creational approach. These steps are identifying all stakeholders, mapping out stakeholder interactions, offering opportunities for stakeholders to share ideas, and building platforms to implement and continue sharing these ideas.

The authors emphasize the importance of resolving issues for customers as key to increasing their loyalty, rather than by exceeding customer expectations. Areas to address include decreasing customer need for follow-up calls, switching service channels, and the potential for negative emotional responses.