Temporal Distance and Price Responsiveness: Empirical Investigation of the Cruise Industry

Temporal distance refers to the time between purchase and consumption in advanced-sales industries. We explore how the response of aggregate demand to price changes with temporal distance in a large, proprietary data set of Florida cruise prices, bookings, and product attributes. We offer the first evidence that cruise demand becomes more sensitive to price during the advance sales period, unlike extant findings in other settings. The results also show that demand is greatest late in the advance sales period, providing the first finding that a late-season high-demand period coincides with a late-season increase in aggregate price sensitivity. The high-demand effect more than offsets the high-price-responsiveness pattern, leading the firm to increase prices throughout the advance sales period. Although the data do not disentangle multiple competing explanations for the main findings, they are large enough to appear in simple data visualizations and robust enough to replicate across many model specifications, parameterizations, and partitions of the data. This paper was accepted by Matthew Shum, marketing.

An inventory model for coordinating ordering, pricing and advertisement policy for an advance sales system

In this paper we study a coordinated stock replenishment, pricing, and advertisement problem for an inventory with advance booking system. A single period planning horizon is considered, consisting of both advance sales and spot sales periods. The discount is offered to the customers for booking the product in advance when the replenishment arrives. The product demand is price and advertising expenditure sensitive. This paper aims to find the optimal ordering quantity, selling price, and advertising expenditure of the product, which maximizes the total profit. The solution algorithm is suggested for computing the optimal solution, which is illustrated numerically.

The International Political Economy of Soy Agriculture in South America

International agricultural production has been transformed by the consolidation of the agribusiness model. Multinational chemical and trading companies leveraged their scientific and technological superiority over the producers to advance sales of agrochemical and biotechnological products at the same time that they integrated with traders and processors. By advancing financial scale advantages, international corporate actors established powerful buying positions, determined infrastructural developments, and established a globalized pattern of agricultural economic activity. This has been reinforced by converging demand trends of growing global population, a dietary transition in the emerging world that includes more animal products, a diversifying energy matrix that increasingly includes biofuels and the use of agricultural products as a financial asset class. The international political economy (IPE) of the soybean agribusiness model was articulated with the specific national political economies of Brazil, Argentina, and Paraguay. Differential institutional structures and different political economy coalitions and conditions processed these external conditions in different ways: coordination (Brazil), confrontation (Argentina), and colonization (Paraguay).

Advance Sales of Services

We investigate a service provider’s advance selling strategies in the presence of a channel intermediary who improves (i) consumers’ accessibility to the service or (ii) the service provider’s access to higher valuation segments. We evaluate the conditions under which dealing with such an intermediary may offset the attendant costs of providing suitable incentives. Our results indicate that the relative profitability of selling via the intermediary is affected by an interaction among marginal costs, capacity level, and the type of value the intermediary brings to the channel. We find that a capacity-constrained service provider may prefer selling via an intermediary that offers improved access to higher valuation consumers. However, when the service provider has excess capacity, indirect sales is preferred even when the intermediary is simply expanding the reach. In such a setting, both the service provider and the intermediary can enhance their profits in a symbiotic manner. Our findings have several implications for service providers. A service provider with limited capacity and relatively small marginal cost would be better off not contracting with an intermediary. In contrast, service providers with larger capacity and marginal cost will benefit from using an indirect channel despite the costs of incentivizing such an intermediary.

Exploring buyer-seller dyadic perceptions of technology and relationships

Purpose – This paper aims to understand an emerging paradigm for business-to-business selling, Sales 2.0, which connects various enabling technologies within leading sales processes to drive improved business and relational outcomes. In the context of Sales 2.0, this paper addresses the need for buyer–seller dyadic sales research in the literature and highlights the importance of understanding buyer and seller perspectives regarding technology expectations and relationship-building performance. Design/methodology/approach – This research utilizes a dyadic (salesperson–customer) data collection methodology, involving 74 matched salesperson and customer responses (37 dyads) to an online survey. Existing salesperson (self-report) measures of customer technology expectations and relationship-building performance with customers were utilized and adapted to provide dyadic measures to test for buyer–seller perceptual differences. Findings – The dyadic data analysis supports the presence of significant perceptual differences between the salesperson and their customer, respective of customer technology expectations and relationship-building performance measures. In particular, the analysis reveals bidirectional perceptual differences for the two measures, whereas the salesperson underestimates the importance of their customer’s technology expectations, but overestimates their relational performance relative to their customers. Originality/value – As technology continues to transform salesperson interactions with customers, the value of capturing a deeper understanding about those interactions increases. This study uses matched salesperson–customer dyads from a health-care sales organization to provide researchers and practitioners with insightful findings with respect to buyer–seller interactions and perceptual differences. Further, the research uniquely advances dyadic measures of customer technology expectations and relationship-building performance with customers to advance sales research in the context of Sales 2.0.