Alianza: pricing to enter the pension industry

2014 ◽  
Vol 4 (4) ◽  
pp. 1-6 ◽  
Author(s):  
Pablo Farías
Keyword(s):  
Marketing Research ◽  
Subject Area ◽  
Pricing Strategy ◽  
Marketing Plan ◽  
Marketing Metrics ◽  
Content Type ◽  
Customer Lifetime ◽  
Lifetime Value ◽  
The Impact

Subject area The focus of the case is on the concepts of customer lifetime value (CLV) and customer equity (CE). Monitoring, measuring and maximizing CLV and CE have become a key priority for all marketers. Instructors can introduce these concepts and its key components. The main focus of the case is a quantitative assignment that asks students to analyze the convenience for the existing five AFPs (Administradora de Fondos de Pensiones, Pension Fund Administrator) of winning the tender. The use of CLV and CE measurements is particularly relevant. Students need to estimate the impact of pricing on the CLV and CE of the existing five AFPs. Study level/applicability BA, MSc, MBA Courses: CE, Marketing Metrics, Pricing. The case can also be used in courses that focus on Marketing Plan, Marketing Research or Services Marketing. Case overview In early 2009, Valentina Vial was given the assignment to develop the pricing strategy of Alianza to enter the pension industry. The company will propose a commission fee to compete with the country's existing five AFPs. Whichever AFP presents the lowest commission will be awarded the tender. When there are several competitors, the company must guess each competitor's likely pricing decision. In the analysis of the convenience for the existing five AFPs of winning the tender, the use of CLV and CE measurements is particularly relevant. Valentina Vial needed to estimate the impact of pricing on the CLV and CE of the existing five AFPs. Expected learning outcomes Understand the concepts of CLV and CE and the importance of maximizing a customer's lifetime value for the firm by calculating the CLV and the CE based on a combination of financial and non-financial data. Illustrate the importance of adopting a long-term strategic perspective (using CLV and CE) in choosing a pricing strategy. Once a firm commits to a pricing strategy, it is difficult to shift course. Given this, the choice of pricing levels should be informed by long-term strategic thinking, including consideration of potential competitive pricing decisions. Supplementary materials Teaching Notes are available for educators only. Please contact your library to gain login details or email [email protected] to request teaching notes.

AFP Innova: competing in a tender for new affiliates

2012 ◽  
Vol 2 (7) ◽  
pp. 1-8
Author(s):  
Pablo Farías
Keyword(s):  
Marketing Research ◽  
Subject Area ◽  
Customer Lifetime Value ◽  
Customer Equity ◽  
Financial Data ◽  
Marketing Metrics ◽  
Value Analysis ◽  
Content Type ◽  
Customer Lifetime ◽  
Lifetime Value

Subject area The concepts of customer lifetime value (CLV) and customer equity (CE). Study level/applicability BA, MBA, MSc courses: customer equity, marketing metrics, marketing plan, marketing research. Because students are asked to complete a customer lifetime value analysis based on a range of financial and non-financial data, students will need at least a modest level of proficiency in dealing with a few basic financial accounting concepts. Case overview In Chile, a law passed in 2008 introduced a bidding process to be held every 24 months in the pension industry. The tender mechanism was introduced as part of a reform aimed at reducing the commissions charged by pension fund administrators and at making it easier for new players to enter the market. In early 2009, Daniel Ugarte wondered if it was finally the right time for his firm to enter the pension industry. Ugarte was asked by the board to help chart a direction for the firm. The winning criterion was the lowest management fee (commission) paid by the affiliates. The main focus of the case is a quantitative assignment that asks students to calculate how customer lifetime value (CLV) and customer equity (CE) would be affected by the commission offered. Expected learning outcomes These include: understanding the concepts of customer lifetime value (CLV) and customer equity (CE) and the importance of maximizing a customer's lifetime value for the firm by calculating the CLV and the CE based on a combination of financial and non-financial data. Supplementary materials Teaching notes are available. Consult the librarian for access.

scholarly journals Differentiated Customers’ Loyalty Development in Relation to Different Customer Lifetime Values

Ekonomika ◽  
2004 ◽  
Vol 67 ◽  
Author(s):  
Hana Loštakova ◽  
Martina Kohoutová ◽  
Andrea Koblížková
Keyword(s):  
Customer Relationship Management ◽  
Marketing Research ◽  
Customer Relationship ◽  
Sales Managers ◽  
Industrial Firms ◽  
Individual Interviews ◽  
Customer Lifetime ◽  
Lifetime Value ◽  
Total Market

This paper shows that it is not effective to increase the total market share at present, but it is more effective to pay attention to increasing the share at key customers (wallet share). Building a differentiated customer relationship management and a customers’ loyalty according to different customer lifetime value (CLTV) is a must. This paper presents the results of a qualitative marketing research by means of the method of individual interviews with SBU managers, marketing managers and sales managers in the Czech industrial firms operating on B-to-B markets. This research was focused on the benefits of customers’ loyalty development and on mapping the customers’ loyalty development instruments available for building long-term relationships with key customers in the contemporary turbulent market environment.

scholarly journals COVID-19: a pandemic to tourism guest-host relationship in India

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Parvinder Kour ◽  
Aruditya Jasrotia ◽  
Sudhanshu Gupta
Keyword(s):  
Travel Behavior ◽  
Local Community ◽  
Negative Impact ◽  
Participant Observation ◽  
Subject Area ◽  
Current Status ◽  
Content Type ◽  
The Impact ◽  
Depth Interviews

Purpose The emerging situation of pandemic due to COVID-19 has not only influenced the daily life but also the society and travel activities around the world thereby depriving tourists (especially who are already on the move) of facilities and even making them to look for desperate alternatives. Such situation in fact may draw a long-term impact on guest–host relationship while residents’ behavior reflects hostility toward the tourists. Such kind of interactions contributes toward tourists’ perception and experience about the destination and its services thereby affecting their level of acceptance and tolerance for tour and travel activities (Armenski et al., 2011). Moreover, the guest–host relationship has mostly been studied with perspective of and focus on residents/host and not enough on tourists (Skipper, 2009; Vargas-Sánchez et al., 2014). Keeping this in view, this paper aims to analyze the impact of pandemic situation on guest–host relationship and its future impact on travel intentions among the tourists in India. Design/methodology/approach The study undertakes the help of in-depth interviews and extracting themes to understand the guest–host relationship and the perspective of tourists in challenging times like COVID-19 and its impact on the relationship. The secondary sources have been adopted to retrieve the data related to current status of travel industry in India. In-depth interviews were conducted online to gather data for the qualitative analysis regarding the research. Further, the data has been analyzed for retrieving a dimensional approach to subject area. Findings The data from participant observation showed that the hosts displayed panic, mistrust and irresponsible behavior toward the guests, and this clearly indicates that the pandemic situation has a highly negative impact on the image of the community and the destination. This ultimately affects the guest–hosts relationships in the long term. Most of the tourists showed that they were okay with following the rules and respect local culture but were expecting support from local community during distress. It was found that there were two female tourists who were asked to vacate the accommodation, which can be considered as an inappropriate and extreme behavior. Thus, COVID-19 is not only causing a threat to the tourism presently but will have a prolonged influence on guest–host relationship as negative interaction or experiences are supposed to be frequently radiated by the tourists (de Albuquerque and McElroy, 2001). Originality/value There is no dearth of studies focusing on travel behavior dimensions, whereas the linkage of residents’ behavior toward it still requires much consideration and analyzing simultaneously. The study looks into the area of guest–host relationship and tries to explore it from the perspective and significance of tourist (guest) rather than the much read and researched resident (host) perception at the center. The findings of the study could be helpful in drawing the strategic framework for the industry to handle and sustain the guest–host relation so as to safeguard the future of tourism and sustain potential travel market reiterating the significance of tourists/guests and their perspective about the hosts, in developing and growing the tourism of a destination.

The effects of pricing strategy on upgrade intentions

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Hsin-Hsien Liu ◽  
Hsuan-Yi Chou
Keyword(s):  
Sunk Costs ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Residual Value ◽  
Short Term ◽  
Content Type ◽  
State Orientation ◽  
Hedonic Products ◽  
The Impact

PurposeTaking a mental accounting theory perspective, this study explores how pricing strategy (all-inclusive vs partitioned) influences consumers' perceived residual value of a product and their subsequent intentions to upgrade to a newer model.Design/methodology/approachA pilot study and two formal experiments were conducted to test the hypotheses.FindingsA partitioned (vs all-inclusive) price causes consumers to later recall a lower total cost and perceive lower residual value for the existing product, thereby increasing upgrade intentions. This finding holds for both utilitarian and hedonic products. Perceived residual value mediates the impact of the pricing strategy on upgrade intentions. The pricing strategy effect is stronger for state-oriented individuals than for action-oriented individuals.Originality/valueThis study extends understanding of the impact of pricing strategies from consumers' short-term immediate demand to long-term upgrade intentions. It also identifies a previously uninvestigated moderator (action-state orientation), clarifying the boundary conditions of pricing strategy effects. The study's conceptual framework links pricing strategy, sunk costs, perceived residual value and upgrade intentions, providing rich insights and potential research paths. These findings further enhance understanding of upgrade intentions.

Maximizing customers' lifetime value using limited marketing resources

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Mage Marmol ◽  
Anita Goyal ◽  
Pedro Jesus Copado-Mendez ◽  
Javier Panadero ◽  
Angel A. Juan
Keyword(s):  
Location Problem ◽  
Formal Model ◽  
Facility Location Problem ◽  
Content Type ◽  
Customer Lifetime ◽  
Marketing Resources ◽  
Lifetime Value ◽  
The Cost ◽  
The Impact ◽  
A Company

PurposeFor any given customer, his/her profitability for a business enterprise can be estimated by the so-called customer lifetime value (CLV). One specific goal for many enterprises consists in maximizing the aggregated CLV associated with its set of customers. To achieve this goal, a company uses marketing resources (e.g. marketing campaigns), which are usually expensive.Design/methodology/approachThis paper proposes a formal model of the Customer Life Value problem inspired by the uncapacitated facility location problem.FindingsThe computational experiments conducted by the authors illustrate the potential of the approach when compared with a standard (non-algorithm-supported) one.Originality/valueThe approach leads up to the economic trade-off between the volume of the employed resources and the aggregated CLV, i.e. the higher the number of resources utilized, but also the higher the cost of achieving this level of lifetime value. Hence, the number of resources to be “activated” has to be decided, and the effect of each of these resources on each CLV will depend upon how “close” the resource is from the corresponding customer (i.e. how large will the impact of the active resource on the customer).

The storm after the storm: the long-term lingering impacts of hurricanes on schools

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Cassandra R. Davis ◽  
Sarah R. Cannon ◽  
Sarah C. Fuller
Keyword(s):  
North Carolina ◽  
Data Collection ◽  
Instructional Time ◽  
Emotional Needs ◽  
Social Emotional ◽  
Content Type ◽  
The North ◽  
State Education ◽  
The Impact

PurposeThe purpose of this paper is to identify and describe the long-term impacts of hurricanes on schools and discuss approaches to improving recovery efforts.Design/methodology/approachInterviews with 20 school districts in Texas and North Carolina after Hurricanes Harvey (2017) and Matthew (2016). In total, 115 interviews were conducted with teachers, principals, district superintendents and representatives from state education agencies. Interview questions focused on the impact of storms and strategies for recovery.FindingsThe authors uncovered three long-term impacts of hurricanes on schools: (1) constrained instructional time, (2) increased social-emotional needs and (3) the need to support educators.Research limitations/implicationsThis paper focuses on two storms, in two states, in two successive years. Data collection occurred in Texas, one academic year after the storm. As compared to the North Carolina, data collection occurred almost two academic years after the storm.Practical implicationsThis paper illuminates strategies for stakeholders to implement and expedite hurricane recovery through; (1) updating curricula plans, (2) providing long-term counselors and (3) supporting educators in and out of school.Originality/valueTo date, very few studies have explored the ways in which schools face long-term impacts following a disaster. This paper provides insight to the challenges that prolong the impacts of disasters and impede recovery in schools. With hurricanes and related disasters continuing to affect schooling communities, more research is needed to identify the best ways to support schools, months to years after an event.

Mcdonald’s versus Vikram Bakshi

2021 ◽  
Vol 11 (4) ◽  
pp. 1-27
Author(s):  
Nitin Pangarkar ◽  
Neetu Yadav
Keyword(s):  
Emerging Markets ◽  
Multinational Corporations ◽  
Service Industry ◽  
Executive Development ◽  
Content Type ◽  
Academic Level ◽  
Quick Service ◽  
Term Performance ◽  
The Impact

Learning outcomes The case illustrates the challenges of managing JVs in emerging markets. specifically, after going through the case, students should be able to: i.Analyze the contexts in which firms need to form JVs and evaluate this need in the context of emerging markets such as India; ii.Understand how multinational corporations can achieve success in emerging markets, specifically the role of strategic (broader than the product) adaptation in success; iii.Evaluate the impact of conflict between partners on the short-term and long-term performance of a JV; and iv.Create alternatives, evaluate each alternative’s pros and cons, and recommend appropriate decisions to address the situation after a JV unravels and the organization is faced with quality and other challenges. Case overview/synopsis McDonald’s, the global giant in the quick service industry, entered India in 1993 and formed two JVs in 1995 one with Vikram Bakshi (Connaught Plaza Restaurants Ltd or CPRL) to own and operate stores in the northern and eastern zones, and another with Amit Jatia (Hardcastle Restaurants Private Limited or HRPL) to own and operate stores in the western and southern zones. Over the next 12 years, both the JVs made steady progress by opening new stores while also achieving better store-level metrics. Though CPRL was ahead of HRPL in terms of the number of stores and total revenues earned in 2008, the year marked the beginning of a long-running dispute between the two partners in CPRL, Bakshi and McDonald’s. Over the next 11 years, Bakshi and McDonald’s tried to block each other, filed court cases against each other and also exchanged recriminations in media. The feud hurt the performance of CPRL, which fell behind HRPL in terms of growth and other metrics. On May 9, 2019, the feuding partners reached an out-of-court settlement under which McDonald’s would buy out Bakshi’s shares in CPRL, thus making CPRL a subsidiary. Robert Hunghanfoo, who had been appointed head of CPRL after Bakshi’s exit, announced a temporary shutdown of McDonald’s stores to take stock of the current situation. He had to make a number of critical decisions that would impact the company’s performance in the long-term. Complexity academic level MBA, Executive MBA and executive development programs. Supplementary materials Teaching Notes are available for educators only. Subject code CSS 11: Strategy.

Enterprise risk management and sustainability of banks performance

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Babajide Oyewo
Keyword(s):  
Risk Management ◽  
Banking Sector ◽  
Management Practice ◽  
Enterprise Risk Management ◽  
Annual Reports ◽  
Banking Reform ◽  
Content Type ◽  
Enterprise Risk ◽  
The Impact

PurposeThis study investigates firm attributes (namely level of capitalisation, scope of operation, organisational structure, organisational lifecycle, systemic importance and size) affecting the robustness of enterprise risk management (ERM) practice, the extent to which ERM affects the performance of banks and the impact of ERM on the long-term sustainability of banks in Nigeria. This was against the backdrop that the 2012 banking reform was a major regulatory intervention that mainstreamed ERM in the Nigerian banking sector.Design/methodology/approachThe study employed a mixed methodology of content, trend and quantitative analyses. Ex post facto research design was deployed to analyse performance differential of banks, with respect to the implementation of ERM, over a 10-year period (2008–2017). A disclosure checklist developed from the COSO ERM integrated framework was used to assess the robustness of ERM by content-analysing divulgence on risk management in published annual reports. The banking reform periods were dichotomised into pre- (2008–2012) and post- (2013–2017) reform periods. Jonckheere–Terpstra test, independent sample t-test and Mann–Whitney test were applied to analyse a total of 1,036 firm-year observations over the period 2008–2017.FindingsResult shows that bank attributes significantly affecting the robustness of risk management practice are level of capitalisation, scope of operation, systemic importance and size. Performance of banks improved slightly during the post-2012 banking reform period. This suggests that as banks consolidate on the gains of ERM, benefits of the regulatory policy on risk management may be realised in the long run. Result also shows that ERM enhances long-term performance, connoting that effective risk management could serve as a competitive strategy for surviving turbulence that typically characterises the banking sector.Practical implicationsThe emergence of level of capitalisation, scope of operation, systemic importance and size as determinants of ERM provides empirical evidence to support the practice of reviewing the capital requirements for banking business from time to time by regulatory authorities (i.e. recapitalisation policy) as a strategy for managing systemic risk. Top management of banks may consider instituting mechanisms that will ensure risk management is given prominence. A proactive approach must be taken to convert risks to opportunities by banks and other financial institutions, going forward, to cope with the vicissitudes of financial intermediation.Originality/valueThe originality of the study stems from the consideration that it provides some new insights into the impact of ERM on banks long-term sustainability in a developing country. The study also contributes to knowledge by exposing the factors determining the robustness of risk management practice. The study developed a checklist for assessing ERM practice from annual reports and other risk management disclosure documents. The paper also adds to the scarce literature on risk governance and risk management.

Corporate social responsibility and financial performance: bidirectional relationship and mediating effect of customer loyalty: investigation in Sweden

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Abir Hichri ◽  
Moez Ltifi
Keyword(s):  
Corporate Social Responsibility ◽  
Financial Performance ◽  
Customer Loyalty ◽  
Mediating Effect ◽  
Content Type ◽  
Global Context ◽  
Bidirectional Relationship ◽  
Corporate Social ◽  
The Impact

Purpose The study is based on a hybrid model composed of accounting and business data and is amongst the first to test the impact of corporate social responsibility (CSR) performance on the financial performance of the company, as well as the impact of financial performance on CSR performance. The bidirectional logic chosen by the study is rarely adopted in the global context and has never been tested in the Swedish context. Moreover, the purpose of this paper is to test the mediating effect of customer loyalty on the company’s CSR performance-financial performance relationship to assess this effect over the long term. This design has been neglected in previous studies. Design/methodology/approach Data was collected from a sample of 110 Swedish companies during the period 2009–2019. This study collects the data from the Thomson Reuters Eikon database. A multiple regression analysis was performed to test the hypotheses. Findings The results confirmed the bidirectional relationship between CSR performance and company financial performance. This means that CSR performance positively influences the company’s financial performance. Similarly, financial performance positively influences the company’s CSR performance. Moreover, customer loyalty has a positive and significant mediating effect on the company’s CSR performance-financial performance relationship. Originality/value This study adds several inputs. The first contribution of the research is to test a hybrid model composed of accounting and commercial data. This model is amongst the first to test the impact of CSR performance on the financial performance of the company and the impact of financial performance on CSR performance. The second contribution is the bidirectional logic chosen by the study which is rarely adopted in the global context and has never been tested in the Swedish context. The third contribution is to test the mediating effect of customer loyalty on the company’s CSR performance-financial performance relationship to assess this effect over the long term. This design has been neglected in previous studies. The fourth contribution is the choice of the field of investigation for the reliability of the data used and the generalisation of the results obtained.

Does salience matter in investment decision?

Kybernetes ◽  
2019 ◽  
Vol 48 (8) ◽  
pp. 1894-1912
Author(s):  
Samra Chaudary
Keyword(s):  
Investment Decision ◽  
Investment Decisions ◽  
Equation Modeling ◽  
Individual Investors ◽  
Short Term ◽  
Content Type ◽  
Multigroup Analysis ◽  
Money Managers ◽  
The Impact

Purpose The paper takes a behavioral approach by making use of the prospect theory to unveil the impact of salience on short-term and long-term investment decisions. This paper aims to investigate the group differences for two types of investors’ groups, i.e. individual investors and professional investors. Design/methodology/approach The study uses partial least square-based structural equation modeling technique, measurement invariance test and multigroup analysis test on a unique data set of 277 active equity traders which included professional money managers and individual investors. Findings Results showed that salience has a significant positive impact on both short-term and long-term investment decisions. The impact was almost 1.5 times higher for long-term investment decision as compared to short-term decision. Furthermore, multigroup analysis revealed that the two groups (individual investors and professional investors) were statistically significantly different from each other. Research limitations/implications The study has implications for financial regulators, money managers and individual investors as it was found that individual investors suffer more with salience heuristic and may end up with sub-optimal portfolios due to inefficient diversification. Thus, investors should be cautious in fully relying on salience and avoid such bias to improve investment returns. Practical implications The study concludes with a discussion of policy and regulatory implications on how to minimize salience bias to achieve optimum and diversified portfolios. Originality/value The study has significantly contributed to the growing body of applied behavioral research in the discipline of finance.

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