There is now an extensive theoretical literature investigating optimal inventory policies for retailers. Yet several recent reviews have recognized that these models are rarely applied in practice. One explanation for the paucity of practical applications is the difficulty of measuring how stockouts affect both current and future demand. In this paper, we report the findings of a large-scale field test that measures the short- and long-run opportunity cost of a stockout. The findings confirm that the adverse impact of a stockout extends to both other items in the current order as well as future orders. We show how the findings can be used to provide input to inventory planning models and illustrate how failing to account for the long-run effects of a stockout will lead to suboptimal inventory decisions. We also demonstrate how the findings can be used in a customer lifetime value model. Finally, the study investigates the effectiveness of different responses that firms can offer to mitigate the cost of stockouts. There is considerable variation in the effectiveness of these responses. Offering discounts to encourage customers to backorder rather than cancel their orders is widely used in practice, but that was the least profitable of the responses that we evaluated. The findings have important implications for retailers considering the use of discounts as a response to stockouts.inventory, long run, stockouts

When a firm allows the return of previously purchased merchandise, it provides customers with an option that has measurable value. Whereas the option to return merchandise leads to an increase in gross revenue, it also creates additional costs. Selecting an optimal return policy requires balancing both demand and cost implications. In this paper, we develop a structural model of a consumer's decision to purchase and return an item that nests extant choice models as a special case. The model enables a firm to both measure the value to consumers of the return option and balance the costs and benefits of different return policies. We apply the model to a sample of data provided by a mail-order catalog company. We find considerable variation in the value of returns across customers and categories. When the option value is large, there are large increases in demand. For example, the option to return women's footwear is worth an average of more than $15 per purchase to customers and increases average purchase rates by more than 50%. We illustrate how the model can be used by a retailer to optimize his return policies across categories and customers.choice models, consumer behavior, decisions under uncertainty, direct marketing, e-commerce, econometric models, hierarchical Bayes analysis, latent variable models, marketing operations interface, service quality, targeting, returns

We document that approximately 5% of product reviews on the website of a large private label retailer are submitted by customers for which there is no record they have purchased the product they are reviewing. These reviews are significantly more negative than other reviews. They are also less likely to contain expressions describing the fit or feel of the items, but more likely to contain linguistic cues associated with deception. The reviews without confirmed transactions are written by over twelve thousand of the firm's best customers, who on average have each made over 150 purchases from the firm. This makes it very unlikely that the reviews are written by the employees or agents of a competitor, suggesting that deceptive reviews may not be limited to just the strategic actions of firms. Instead, the phenomenon may be far more prevalent, extending to individual customers who have no financial incentive to influence product ratings.

We use the results of three large-scale field experiments to investigate how the depth of a current price promotion affects future purchasing of first-time and established customers. While most previous studies have focused on packaged goods sold in grocery stores, we consider durable goods sold through a direct mail catalog. The findings reveal different effects for first-time and established customers. Deeper price discounts in the current period future purchases by first-time customers (a positive long-run effect) but future purchases by established customers (a negative long-run effect). Overall, the results show evidence of several long-run effects: forward buying, selection, customer learning, and increased deal sensitivity. Short-run metrics that ignore these effects overstate the overall change in demand for established customers. The implication is that if prices are set based on short-run elasticity, then they will be too low. Among first-time customers, the short-run metrics underestimate the total increase in demand. If prices are set based on short-run elasticity, then they will be too high.price promotions, pricing, long-term effects, forward buying, purchase acceleration, deal sensitivity, catalogs

Characterization of a population of green turtles inhabiting the northeastern Gulf of Mexico was made possible by the mortality of a subset of > 4500 sea turtles that stranded during a mass cold stunning event in Florida, USA, during January 2010. In total, 434 dead, stranded green turtles Chelonia mydas were evaluated through necropsy and skeletochronological analysis to characterize morphology, sex, body condition, disease status, age structure, and growth patterns. Standard straightline carapace lengths ranged from 18.1 to 78.5 cm (mean ± SD = 36.3 ± 10.4 cm) and did not significantly differ from those of stranded green turtles that survived this event. Prevalence of fibropapilloma (FP) was low, at 6%, and sex ratio was significantly biased toward females (2.45F:1M). Age estimates ranged from 2 to 22 yr (mean ± SD = 9 ± 4 yr) and female age distribution was significantly greater than that of males. Mean stage durations, as calculated through sum mation of size class-specific growth rates and fitting smoothing spline models to length-at-age data, were similar and ranged from 17 to 20 yr. Generalized additive models and generalized additive mixed models were used to assess the potential influence of discrete and continuous covariates on growth rates. Somatic growth was significantly influenced by size, age, and calendar year; however, no effect of sex, FP status, or body condition was found. Increased understanding of population parameters will improve population models for the species and can also serve as a reference for assessing potential effects of the 2010 Deepwater Horizon oil spill in the Gulf of Mexico. 458: 213-229, 2012 mation was recently emphasized in the aftermath of the April 20, 2010, Deepwater Horizon (DWH) MC-252 oil spill in the Gulf of Mexico during initiation of efforts to assess the effects to sea turtles of this catastrophic event (Bjorndal et al. 2011, Crowder & Heppell 2011. However, collection of these data is made difficult by deficiencies in the ability to assess sea turtle populations in an unbiased manner (Heppell et al. 2003). Population characterizations based on nesting beach studies, while prevalent due to the relative accessibility of the females on the beach, are necessarily focused in their scope (NRC 2010). In-water studies are often restricted to limited geographic areas (Bjorndal & Bolten 2000) and the proportion of individuals available to be sampled can be influenced by stage-and population-specific partitioning of habitat use (Musick & Limpus 1997, Plotkin 2003 and sex-specific behavior (Wibbels 2003). In addition, the time frames over which data collection must occur to adequately assess population parameters for these generally slow-to-mature, long-lived species are daunting (Heppell et al. 2003). OPEN PEN ACCESS CCESSMar Ecol Prog SerLife history data obtained from dead, stranded sea turtles can be informative, but often need to be interpreted with caution given the general lack of information regarding cause of death (natural vs. anthropogenic) (NRC 2...