Department of Marketing & Entrepreneurship

Time: Friday 10:00 - 11:30 a.m.
Location: 365B Melcher Hall
Open to Public: No reservation or registration required.

Note: Topics and Abstracts will be added to this page throughout the semester

Date Speaker Topic Faculty Host
4/26/2019 Hari Sridhar
Texas A&M
    The Dual Role of Advertising in Brand Management
  • Click to read Abstract

    Advertising builds a firm’s brand by (1) increasing brand awareness and (2) enhancing brand image. These, in turn, increase customer purchase and firm performance. Extant research has not disentangled advertising spending’s relative impact on each of the two paths, which is important for managers when deciding both advertising budgets and allocation across multiple media. We leverage a unique dataset of .8 million observations representing 1,999 brands to examine how advertising affects awareness and familiarity (i.e., brand awareness) as well as perceived quality (i.e., brand image). Moreover, we estimate advertising effectiveness separately by national, regional, and online media, which is important for resource-allocation implications. We account for endogeneity in advertising using the identification strategy of partially overlapping peer groups. We find that national advertising contributes to brand building by not only increasing brand awareness but also enhancing perceived quality. In contrast, regional and online advertising simultaneously enhance and damage a brand—i.e., they enhance brand awareness but harm perceived quality. Importantly, results show that, in total (i.e., through brand awareness and perceived quality), national advertising has a positive association with purchase intention whereas regional and online advertising have a non-significant association with purchase intention. To further provide managers with insights, we investigate how the effect of advertising translates into sales.

UH Hilton

    The 37th UH Marketing Doctoral Symposium
UH Hilton
Fred Feinberg
U of Michigan
    The 37th UH Marketing Doctoral Symposium
    Keynote Speaker: Fred Feinberg
4/5/2019 Claudia Townsend
U of Miami
    The Ugly Luxury Premium: When Distinctiveness Pays Off
  • Click to read Abstract

    Consumers choose attractive goods. However, this research identifies the “ugly luxury premium”. Three lab studies and two analyses of Amazon data show that, while consumers avoid ugly non-luxury products, among luxury, consumers view distinctively ugly products as more luxurious and fashion-forward, and choose them as often as beautiful ones.

Shijie Lu
3/22/2019 Alina Sorescu
Texas A&M
  • Click to read Abstract

    Research has found that employees will accept lower pay at companies with strong brands, with the associated compensation savings touted as a bottom-line benefit to the firm. We show that this represents a false economy. Using data from multiple secondary sources, we find that brand-derived compensation savings actually decrease profits due to lower pay’s offsetting negative effects on employee productivity and retention. Importantly, we find this relationship to be nuanced. Different dimensions of brand knowledge have opposite effects on pay, employee behaviors, and profits. Brands high in esteem, familiarity, and relevance are associated with lower pay, productivity, retention, and profits, while brands high in energized differentiation are associated with higher pay, productivity, retention, and profits. Tests to resolve endogeneity concerns and an online experiment support our theory.

Sam Hui
3/8/2019 Shubhranshu Singh
Johns Hopkins
    Conspicuous by Its Absence: Diagnostic Expert Testing under Uncertainty
  • Click to read Abstract

    We study the problem a diagnostic expert (e.g., a physician) faces when offering a diagnosis to a client (e.g., a patient) that may be based only on her own diagnostic ability or supplemented by a diagnostic test revealing the client’s true condition. The expert’s diagnostic ability (or type) is her private information. The expert is impurely altruistic in that she cares about both the client’s utility and her own reputational payoff that depends on the peer perception about her diagnostic ability. The decision of whether to perform the test, which is costly for the client, provides the expert with an opportunity to influence that perception. We show a unique separating equilibrium exists in which the high-type expert does not resort to diagnostic testing and offers a diagnosis based only on her own diagnostic ability, whereas the low-type expert performs the test. Furthermore, we establish that the high-type expert may skip necessary diagnostic tests to separate her from the low-type expert. Interestingly, the effect of reputational payoff on under-testing is non-monotonic, and the desire to appear of high type leads to under-testing only when the reputational payoff is intermediate. Our results also suggest a more altruistic expert may be more likely to engage in under-testing. Furthermore, efforts to encourage testing by providing financial incentives or by raising malpractice-lawsuit concerns may, surprisingly, help fuel under-testing in the equilibrium.

Seshadri Tirunillai
2/1/2019 Raghuram Iyengar
    The Impact of Subscription Programs on Customer Purchases
  • Click to read Abstract

    Subscription programs are increasingly popular among a wide variety of retailers including Amazon (Prime), Barnes & Noble (B&N Membership), and Sephora (Flash). These types of programs give members access to a set of exclusive benefits for a fixed fee upfront. In this paper, we document the causal effect of customers’ adoption of a subscription program on their subsequent purchases. Using a unique data set of a subscription program launched by a firm in the fast-moving consumer goods industry, we find subscription leads to a very large increase in customer purchases, with significant variation across customers. The effect is economically significant and persistent. Members are more engaged with the company as they purchase more frequently and a greater variety of products. We provide evidence that customers experience a sunk cost fallacy and switch their purchases away from competitors to the focal company in product categories with lower switching costs. We discuss the implications for subscription businesses and customer retention.

Sam Hui
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Department of Marketing & Entrepreneurship
University of Houston
334 Melcher Hall
Houston, Texas 77204-6021
Phone: 713-743-4555
Fax: 713-743-4572