On Customized Goods, Standard Goods, and Competition

Syam, Niladri; Kumar, Nanda

doi:10.1287/mksc.1060.0199

Cited by 107 publications

(66 citation statements)

References 15 publications

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“…Now definitions will be provided regarding the characteristics of the purchase situation Regarding product-specific factors, we investigate the potential moderating influence of product individuality, importance, complexity, and brand strength. We define product individuality as the degree to which a supplier's products are customized to meet specific needs of the customers (Syam and Kumar 2006). Product importance is defined as the general impact of a supplier's products on customer goal achievement (McQuiston 1989).…”

Section: Overview Of Frameworkmentioning

confidence: 99%

When does salespeople’s customer orientation lead to customer loyalty? The differential effects of relational and functional customer orientation

Homburg

Müller²,

Klarmann

2010

J. of the Acad. Mark. Sci.

197

185

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The IMU publishes papers geared towards managers in companies. Subjects highly relevant to business practice are presented here in a compact and concise manner, and scientific research results are efficiently communicated. In many cases, these publications are based on applicationoriented research and cooperation projects involving a large number of global companies. Scientific Working PapersThe scientific studies conducted by the IMU analyze new trends that have an impact on marketoriented management. On this basis, practice-oriented findings are derived and published in our series of scientific working papers. Today, many of our publications have been printed in prominent journals and honored with awards at international conferences (e.g., by the American Marketing Association)..  NEW: Marketing Exzellenz Working Papers (in German only)These new working papers provide practical insights into recent research findings. They are tailored to researchers and practitioners interested in marketing and sales. Our German summaries of current studies published in renowned academic journals such as the Journal of Marketing Research or the Journal of the Academy of Marketing Science focus on results and implications, thus, bridging theory and practice.  Series PublicationIn addition to publishing scientific working papers, the IMU, in cooperation with Gabler publishing house, issues a series featuring exemplary scientific findings from the field of market-oriented management.If you require additional information or have any questions, please contact the Institute for MarketOriented Management, University of Mannheim, L5, 1, 68131 Mannheim, Germany (phone: +49 621/ 181-1755) or visit our website at: www.imu-mannheim.com. The Institute for Market-Oriented Management

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Section: Overview Of Frameworkmentioning

confidence: 99%

When does salespeople’s customer orientation lead to customer loyalty? The differential effects of relational and functional customer orientation

Homburg

Müller²,

Klarmann

2010

J. of the Acad. Mark. Sci.

197

185

View full text Add to dashboard Cite

show abstract

“…Syam, Ruan, and Hess (2005) show that competing firms will customize only one of two product attributes to soften price competition. Syam and Kumar (2006) find that offering customized products in addition to standard products can expand demand and improve profits. In the customization literature, firms are often assumed to exogenously know at least the distribution of consumer preferences.…”

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confidence: 99%

The Perils of Behavior-Based Personalization

Zhang¹

2011

Marketing Science

153

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Abstract"Behavior-based personalization" has gained popularity in recent years, whereby businesses offer personalized products based on consumers' purchase histories. This paper highlights two perils of behavior-based personalization in competitive markets. First, although purchase histories reveal consumer preferences, competitive exploitation of such information damages differentiation, similar to the classic finding that behavior-based price discrimination intensifies price competition. With endogenous product design, there is yet a second peril. It emerges when forward-looking firms try to avoid the first peril by suppressing the information value of purchase histories. Ideally, if a market leader serves all consumers on day one, purchase histories contain no information about consumer preferences. However, knowing that their rivals are willing to accommodate a market leader, firms are more likely to offer a mainstream design at day one, which jeopardizes differentiation. Based on this understanding, I investigate how the perils of behavior-based personalization change under alternative market conditions, such as firms' better knowledge about their own customers, consumer loyalty and inertia, consumer self-selection, and the need for classic designs.

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“…This model is based on the Hotelling's model, in which two firms compete in location and price within a linear city. The classic model has been widely applied in much work [34][35][36]. Gabszewicz and Thisse [34] study the product differentiation problem.…”

Section: Related Literaturementioning

confidence: 99%

“…Gabszewicz and Thisse [34] study the product differentiation problem. Syam and Kumar [35], and Xia and Rajagopalan [36] analyze competition with customized and standard goods. In the above models, firms' variety or customization decisions can directly change customers' utility.…”

Section: Related Literaturementioning

confidence: 99%

Organic vs. Non-Organic Food Products: Credence and Price Competition

Wang

Zhu

2017

Sustainability

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Abstract:We analyze the organic and non-organic production choices of two firms by considering customers' trust in organic food products. In the context of customers' possible willingness to pay a premium price and their mistrust in organic food products, two firms first make choices on offering organic and non-organic food products. If offering organic products, a firm can further invest in the credence system to increase customers' trust in their organic products. At the final stage, two firms determine prices. We provide serval insights. First, we characterize the market conditions in which only one firm, both firms or neither firm will choose to offer organic food products. We find that the higher the production costs or credence investment costs for organic food products are, the more likely firms are to choose to produce non-organic food products. Second, if it is expensive enough to invest in organic credence, offering organic food products may still be uncompetitive, even if organic production cost appears to have no disadvantage compared to non-organic food products. Third, we highlight how the prices of organic food products in equilibrium are affected by market parameters. We show that when only one firm offers organic food products, this firm tends to offer a relatively low price if organic credence investment is expensive. Fourth, we highlight how one firm's credence investment decision in equilibrium can be affected by the product type choice of the other firm. We find that the investment in organic credence is lower when both firms offer organic food products compared with the case when only one firm offers organic food products.

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On Customized Goods, Standard Goods, and Competition

Cited by 107 publications

References 15 publications

When does salespeople’s customer orientation lead to customer loyalty? The differential effects of relational and functional customer orientation

When does salespeople’s customer orientation lead to customer loyalty? The differential effects of relational and functional customer orientation

The Perils of Behavior-Based Personalization

Organic vs. Non-Organic Food Products: Credence and Price Competition

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