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Article

Mohammad G. Nejad

This paper provides an overview of agent-based modeling and simulation (ABMS) and evaluates the questions that have been raised regarding the “assumptions and mechanisms…

Abstract

Purpose

This paper provides an overview of agent-based modeling and simulation (ABMS) and evaluates the questions that have been raised regarding the “assumptions and mechanisms used” by a well-cited paper that has used this methodology.

Design/methodology/approach

This work provides a review of agent-based simulation modeling and its capabilities to advance and test theory. The commentary then evaluates and addresses the raised questions and reservations.

Findings

Agent-based modeling offers unique capabilities that can be used to explore complex phenomena in business and marketing. Some of the raised reservations may be considered as directions for future research. However, the criticisms are for most part unsupported by existing research and do not undermine the contributions of the paper that is being discussed.

Practical implications

Given its relative novelty, reservations regarding agent-based simulation modeling are quite natural. Discussions like this one would bring together different points of view and lead to a better understanding of how using ABMS can benefit academia and industry.

Originality/value

This commentary is part of an intellectual dialogue that seeks to provide different points of view about agent-based simulation modeling using a specific paper as an example.

Details

European Journal of Marketing, vol. 50 no. 3/4
Type: Research Article
ISSN: 0309-0566

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Article

Mohammad G. Nejad and Katayon Javid

The purpose of this paper is to explore the relationship between consumers’ subjective and objective financial literacy (OFL) – the necessary knowledge and skills to make…

Abstract

Purpose

The purpose of this paper is to explore the relationship between consumers’ subjective and objective financial literacy (OFL) – the necessary knowledge and skills to make effective personal financial decisions – and their effects on opinion leadership and the use of retail financial services.

Design/methodology/approach

In total, 486 US participants were surveyed. The demographical profile of the sample roughly resembled that of the USA population.

Findings

On average, consumers with moderate levels of OFL report lower subjective financial literacy (SFL) compared to those with low or high levels of OFL. Moreover, while SFL and opinion leadership are positively correlated, consumers with moderate levels of OFL reported lower opinion leadership compared to those with high or low levels of OFL. The paper introduces financial literacy miscalibration as the discrepancy between consumers’ objective and SFL. Financially illiterate respondents who perceived themselves as financially knowledgeable reported high opinion leadership. Finally, a greater percentage of financially – literate consumers reported owning checking and savings accounts, using online and mobile banking for diverse purposes, and making fewer phone calls to customer services, compared to others.

Research limitations/implications

The paper integrates literature from financial literacy, consumer knowledge, and opinion leadership to explain these findings and to further enhance our theoretical and empirical understanding of objective vs SFL.

Practical implications

The discrepancies between objective and SFL may significantly influence consumers’ financial decisions and the degree to which they expose themselves to the pertinent risks. The paper discusses implications for public policy makers as well as marketing managers and researchers.

Originality/value

The study is the first to empirically explore the research questions following the conceptual development.

Details

International Journal of Bank Marketing, vol. 36 no. 4
Type: Research Article
ISSN: 0265-2323

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Article

Hooman Estelami and Mohammad G. Nejad

While existing research has established various methods for pricing, the impact of a manager’s individual psychological profile on his/her price setting behavior is…

Abstract

Purpose

While existing research has established various methods for pricing, the impact of a manager’s individual psychological profile on his/her price setting behavior is relatively unexamined. This is especially critical in the context of pricing decisions implemented in response to competitive forces. This paper aims to explore how a manager’s price responses to price cuts by a competitor are affected by his/her cognitive style, gender and entrepreneurial attitudes.

Design/methodology/approach

In the first study, a simulation-based pricing environment is used in a lab setting to capture the dynamics of pricing decisions made in response to competitive price cuts. Participants’ price responses are captured in the form of the magnitude of price change implemented in a simulated environment in response to a competitor’s price reduction. The second study extends the scope of inquiry by using a national sample of business professionals and replicates and reinforces the findings of the first study by capturing participants’ attitudinal response on the decision to reduce prices in reaction to competitive price reductions.

Findings

The results of both studies indicate significant effects for cognitive style, gender and entrepreneurial attitudes. Individuals with stronger entrepreneurial attitudes and analytical cognitive styles, and females are less likely to engage in reactive price reductions.

Research limitations/implications

The findings of this study indicate that managers’ propensity to engage in price changes in reaction to competitors can be linked to their psychological profile and gender.

Practical implications

Given the existence of the relationship between price reactions of managers and their cognitive style and entrepreneurial attitudes, the training and development of pricing professionals may need to take these individual-level factors into account.

Originality/value

This is the first study that has linked managers’ propensity to engage in price changes in reaction to competitors to their gender and psychological profile.

Details

Journal of Product & Brand Management, vol. 26 no. 7
Type: Research Article
ISSN: 1061-0421

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Article

Allard C.R. Van Riel, Jie J. Zhang, Lee Phillip McGinnis, Mohammad G. Nejad, Milos Bujisic and Paul A. Phillips

While innovative service systems may create substantial value for certain stakeholders, they often destroy value for others. This value paradox frequently leads to…

Abstract

Purpose

While innovative service systems may create substantial value for certain stakeholders, they often destroy value for others. This value paradox frequently leads to unsustainable service systems. The purpose of this paper is to explore the use of multiple theories to pinpoint and explain these value paradoxes, build a framework allowing potentially more sustainable value configuration of service systems and develop an agenda for future research. The framework is illustrated with examples from the hospitality industry.

Design/methodology/approach

The paper draws on prevalent theories and approaches, including service-dominant logic, business modeling, transaction cost economics, stakeholder theory, configuration theory and set theory, to develop a value configuration framework.

Findings

In a service system, the configuration of resources and relationships between these resources (i.e. the set of value propositions for various stakeholders of the system) determines which stakeholders will gain and which will lose and to what extent. For that reason, insight into the range of possible service configurations – or business models – will help decision makers consider the effects on various stakeholders, and, where possible, set their priorities right and make their businesses more sustainable. The research produces a rich research agenda.

Research limitations/implications

Examples from hospitality allow an in-depth examination of a range of dynamic configurational and technological innovations, but some idiosyncratic characteristics of the context may impede the wider applicability of the conceptual framework. Future research could complement this work by studying other service sectors.

Practical implications

The paper aims to provide decision makers in the service industry with a conceptual tool to explore, diagnose and, if needed, adjust the value configuration of their service operations. In practice, this tool may help explicate the service system configuration, thus helping managers determine their organizations’ desired positioning in terms of value creation and destruction, and to choose strategic directions by adapting configurations.

Social implications

Legislation and regulations are being adapted to various new service configurations. This paper attempts to – at least conceptually – distinguish different service configurations, allowing policy makers to identify the value trade-offs between stakeholders, including society at large.

Originality/value

Previous research focused primarily on value creation by innovative services and business models. Value creation for one stakeholder, however, could lead to value destruction for another. Taking this paradox into consideration may result in more open service ecosystems that explicitly consider sustainability and value implications in multiple dimensions and for a broader group of stakeholders.

Details

Journal of Service Management, vol. 30 no. 3
Type: Research Article
ISSN: 1757-5818

Keywords

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Article

Mohammad G. Nejad

This study aims to explore optimal pricing strategies for innovations with direct network externalities – the effect that the number of adopters of an innovation has on…

Abstract

Purpose

This study aims to explore optimal pricing strategies for innovations with direct network externalities – the effect that the number of adopters of an innovation has on the utility of the innovation to other potential adopters. Examples of such innovations are fax machines, e‐mail, cellular phones, and software programs such as word processors. The success of these innovations requires a minimum number of adopters.

Design/methodology/approach

The paper uses agent‐based modeling and simulation.

Findings

The relationship between price and net present value (NPV) of revenue resembles an asymmetric inverse U‐shape. A low‐pricing strategy outperforms high‐pricing, while a moderate‐pricing strategy outperforms both low‐ and high‐pricing strategies. Moreover, heterogeneity of consumer price sensitivity positively affects the NPV of sales.

Practical implications

Pricing durable new products with network externalities is more challenging than other types of innovations. The results indicate that firms can maximize their NPV by adopting a moderate pricing strategy. Moreover, firms must consider heterogeneity of consumer price sensitivity along with the market price elasticity when making pricing decisions. Detailed strategic implications and recommendations are discussed.

Originality/value

Several recent studies have called for examining pricing strategies for new products with network externalities. The study findings challenge the common wisdom that a penetration pricing strategy is an optimal approach for durable products with network externalities. Moreover, while other studies have highlighted the importance of market price elasticity, extensive simulation experiments conducted in this study show that heterogeneity of consumer price sensitivity is an important factor that must be considered. Finally, the study presents an agent‐based modeling approach for exploring optimal pricing of innovations with network externalities.

Details

Journal of Product & Brand Management, vol. 22 no. 2
Type: Research Article
ISSN: 1061-0421

Keywords

Content available

Abstract

Details

International Journal of Bank Marketing, vol. 34 no. 1
Type: Research Article
ISSN: 0265-2323

Abstract

Details

Journal of Hospitality and Tourism Technology, vol. 6 no. 3
Type: Research Article
ISSN: 1757-9880

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Article

Huong Thi Thanh Tran and James Corner

The purpose of this paper is to investigate the distinct effects of different communication channels, particularly interpersonal networks, social media, and mass media on…

Abstract

Purpose

The purpose of this paper is to investigate the distinct effects of different communication channels, particularly interpersonal networks, social media, and mass media on customer beliefs and usage intention in a mobile banking (MB) context.

Design/methodology/approach

This study employed a combination of both qualitative and quantitative research approaches with an exploratory sequential research design in two major phases: focus groups; and a large-scale survey among 183 New Zealand young adults.

Findings

The most significant influential factor of usage intention was perceived usefulness, followed by perceived credibility and perceived costs. Face-to-face communication with bank staff and close acquaintances was perceived as the most reliable and persuasive sources of banking-related information. Moreover, mass channels were considered to be more important and trustworthy than social media in the MB sector. The research results revealed that the current status of MB diffusion in New Zealand is in the latter stages (Late Majority and Laggards) of the innovation diffusion cycle.

Practical implications

In light of the research findings, bank marketers can make the right decisions on marketing actions to promote MB effectively as well as develop appropriate communication policies to speed up the consumer decision process. Researchers and allied industries (e.g. mobile commercial services) could also gain benefits from applying these results to understand the impact of communication channels on consumer perceptions and behaviours towards new technology acceptance.

Originality/value

The research outcomes have served to broaden the knowledge into the distinguishing influences of major communication channels on customers’ beliefs and intention to adopt new banking services.

Details

International Journal of Bank Marketing, vol. 34 no. 1
Type: Research Article
ISSN: 0265-2323

Keywords

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Article

Andrey Martovoy and Anne-Laure Mention

– The purpose of this paper is to map the existing patterns in the development of services innovations in financial institutions.

Abstract

Purpose

The purpose of this paper is to map the existing patterns in the development of services innovations in financial institutions.

Design/methodology/approach

The data come from a dedicated survey of banks located in Luxembourg. Executives and innovation managers reported on banks’ innovation processes for the period of 2010-2012.

Findings

The study unveils four patterns of new service development (NSD) processes. The problem-driven pattern starts with problem definition and represents a bank’s response to an issue. The proactivity-driven pattern commences with idea generation to explore a variety of alternatives. The market-driven pattern emphasises a profit rationale and starts with a business analysis. The strategy-driven pattern frames idea generation within the scope of business goals and starts with the development of a service concept. Most banks keep a balance between being open and closed to cooperation with external partners in the innovation process. Service concept development is the stage most open to the cooperation for innovation, while introduction to a market is the opposite.

Research limitations/implications

The national context and small sample size are the limitations of this study. Promising research avenues include the extension of findings to other settings and understanding of the effects of NSD patterns.

Practical implications

Banks adopt different approaches to the innovation process in order to pursue their innovation goals. Practitioners may use this knowledge in order to re-think the way they innovate.

Originality/value

The unveiled mapping of NSD processes contributes to the understanding of the innovation in financial services. The findings will be valuable for innovation managers, scholars, and students.

Details

International Journal of Bank Marketing, vol. 34 no. 1
Type: Research Article
ISSN: 0265-2323

Keywords

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Article

Faranak Memarzadeh, Shane C. Blum and Charlie Adams

This paper aims to find out the impact of business travelers’ behavioral belief on positive and negative e-comments, which consequently lead to intention to purchase a…

Abstract

Purpose

This paper aims to find out the impact of business travelers’ behavioral belief on positive and negative e-comments, which consequently lead to intention to purchase a hotel room. To explore the relationships among attitude toward positive and negative e-comments with intention to purchase, the Theory of Reasoned Action (TRA) was used.

Design/methodology/approach

Business travelers in the USA who read e-comments and made a hotel choice based on those e-comments within the past six months were targeted for this study. The TRA, as well as a wide-ranging review of literature, were used to develop the survey instrument. The survey was distributed through Qualtrics, which is an online questionnaire service platform. To measure the business travelers’ behavioral beliefs toward e-comments, a number of measures were developed for this research. The theories of Fishbein and Ajzen were used to examine business travelers’ behavioral beliefs toward positive and negative e-comments. All of the questions on this survey about the intention to purchase were extracted from Liao et al. Other questions about attitude toward positive and negative comments were adopted from Chu and Choi, Sparks and Browning, Gundersen et al. and Lee and Sparks. The last section of the survey included questions about business travelers’ sociodemographic statistics, such as ethnicity, level of income, age, gender and education. The first question separated respondents to recognize those who made a reservation at a business hotel in the past six months after reading comments about the hotel. Those who responded positively were asked to participate in the study. Participants of this research presented their degree of agreement on each item by using a seven-point Likert scale, rating from (1) “Strongly disagree” to (7) “Strongly agree”. To verify the reliability of the questionnaire and to ensure it reflected the TRA, a pilot study was conducted with a small group of business travelers who had booked a hotel room in the past six months and finalized their purchases based on reading e-comments. No major changes were made to the survey as a result of the pilot study and all factors indicated an adequate level of internal consistency. The proposed model examined the effects of both positive and negative e-comments toward business travelers’ intention to purchase. This research aimed to determine the impact of behavioral belief on positive e-comments and negative e-comments, which consequently lead to intention to purchase.

Findings

The results of the proposed model revealed that behavioral belief positively affects both positive and negative e-comments. This means that business travelers want to be informed about both complaints and compliments in e-comments. However, this does not mean they intend to purchase a hotel room based on both opinions; rather business travelers would be inclined to purchase a hotel room based on positive e-comments. Using gender as a moderating effect indicated that females neither believe of the helpfulness of negative e-comments nor intend to purchase based on these e-comments. However, males tend to find both positive and negative e-comments helpful.

Originality/value

The findings of this research will help hoteliers, as well as online website review operators, to obtain a clearer understanding of guests’ or users’ needs and wants in order to offer a more desirable service. Since business travelers are considered an important target market in the hotel industry, hoteliers need to put more emphasize on these factors to attract more business travelers. By recognizing business travelers’ requirements and their expectations, hoteliers should prioritize their responsibilities for meeting these guests’ expectations; therefore, they can assign their resources accordingly. In other words, once a guest’s needs are understood clearly, hoteliers will be in safe position to provide the desired service.

Details

Journal of Hospitality and Tourism Technology, vol. 6 no. 3
Type: Research Article
ISSN: 1757-9880

Keywords

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