Browsing by Author "Corsten, Daniel"
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Publication Accessibility and availability: A cross-cultural study of shopper responses to online retail stock-outs(Taylor & Francis, 2021-06-14) Gruen, Thomas; Corsten, Daniel; https://ror.org/02jjdwm75Accessibility of products in online retail is an expected part of the shopper experience journey. Frequent products are not accessible due to non-availability. Introduced by Sheth and Sisodia, the 4A’s framework articulates how success in any marketing program depends on four dimensions: Awareness, Acceptability, Affordability, and Accessibility. This article demonstrates how, like dominos fall, marketing investments can fail when the final 4A’s stage, Accessibility, is not adequately addressed in online retailing. Surveying more than 2,000 shoppers across five European and Asian countries that encountered a non-available item while shopping online for one of six fast-moving consumer goods categories, the research study examines shoppers’ switching behavior when Accessibility has been interrupted in the purchasing stage of the customer journey. The overall goal is to better understand how shoppers change their behavior, and it examines a variety of causes that drive switching behavior, whether it be to switch stores, switch brands, or switch intentions when the item they desired is unavailable. Switching behavior was found to vary greatly among the five countries, but less between categories, and switching was greatly affected by the way shoppers encountered the non-available item. The study concludes with recommendations to address Accessibility both in product availability and shoppers’ transaction costs.Publication Automotive Procurement Under Opaque Prices: Theory with Evidence from the BMW Supply Chain(Informs, 2023-07-27) Turcic, Danko; Markou, Panos; Kouvelis, Panos; Corsten, Daniel; https://ror.org/02jjdwm75Several features of automotive procurement distinguish it from the prototypical supply chain in the academic literature: pass-through pricing that reimburses suppliers for raw material costs, market frictions that prohibit cost transparency and imbue suppliers with pricing power, and contractual commitments that span multiple production periods. In this context, we formalize a procurement model by considering an automaker that buys components from an upstream supplier to assemble cars over several production periods in an environment where period demands and raw material costs are both stochastic. Our paper clarifies how information asymmetry and market factors that amplify or weaken this asymmetry affect the firms’ procurement protocol preferences. Then, using proprietary contract and supplier data from BMW, we empirically validate this model and show that it reflects BMW’s reality: the factors that should theoretically go into automotive procurement decisions do so. Our analysis also reveals that existing contracting protocols in this context are not optimal for procurement under asymmetric information, and so we propose an alternative contracting method. We calibrate our model and estimate an automaker’s performance improvement from this optimal contract over the status quo.Publication Financial and Operational Risk Management: Inventory Effects in the Gold Mining Industry(Wiley, 2021-05-01) Markou, Panos; Corsten, Daniel; https://ror.org/02jjdwm75Financial and operational risk management are central concepts at the intersection of finance, operations, and commodity risk management. Yet, empirical evidence on their effects on inventory is lacking. We use a fine-grained data set comprising the financial and operational risk management decisions of gold miners from 2003 to 2011 to empirically assess the effects of risk management on inventory. Faced with volatile gold prices, miners may manage (output) risk financially by committing to sell future gold production and lock in prices. They may also manage (input) costs operationally by varying the quality of ore they extract and process, thereby altering the costs they incur and influencing inventory holdings. In addition to affecting profitability, we show that these two risk management strategies have implications for inventory holdings. We find that a one-standard deviation increase in financial risk management (FRM) is associated with an 14.3% decrease in inventory, as FRM decreases the option value of delaying processing inventory. On the other hand, a one-standard deviation increase in operational risk management (ORM) is associated with a 3.5% increase in inventory. We also find evidence that, in this context, FRM and ORM could be viewed as complements.Publication How Direct-to- Consumer Brands Can Continue to Grow(Harvard Business Review, 2021-11-01) Rangan, Kasturi; Higgins, Matt; Schlesinge, Leonard; Corsten, Daniel; https://ror.org/02jjdwm75Direct-to-consumer (DTC) brands such as Allbirds, Casper, Peloton, and Warby Parker have creatively found a weakness in the marketing citadel of incumbent brands. By using data gleaned from daily interactions with customers, these brands have been able to adapt how they serve their unique customer communities across a start-to-finish purchase journey. The best of them have parlayed that ability into a profitable business model applied across multiple channels and customer segments. But as successful DTC brands mature, they must recognize the need to evolve. The authors offer four principles for continued success: (1) Focus on deepening customer relationships, not just making comparisons with competitors. (2) Accompany the customer beyond the initial transaction. (3) Omnichannel is about value addition, not cost reduction. (4) Strengthen the core first; consider extensions later.Publication Online Availability(Springer, 2019-11-01) Gruen, Thomas; Corsten, Daniel; https://ror.org/02jjdwm75This chapter presents a research study of online availability (OLA) in six non-food consumer goods categories (baby care, fabric care, hair care, oral care, skin care, and shave care) at online and omnichannel retailers in six major countries (China, France, Germany, Japan, UK, and USA). It provides insight into the extent of online availability (OLA) and its opposite non-online availability (NOLA) using data from online retailers’ websites, reports from surveys of online shoppers, and surveys from managers of online retail and branded goods manufacturers. It illuminates online shoppers’ encounters with NOLA and reactions to it with a detailed examination of switching behavior to alternative options. It estimates the lost sales opportunities and provides guidelines for improving OLA.
