Tag Archives: marketing

Valentine’s Day gifts: Are you giving knockoffs or the real deal? — Renée Richardson Gosline

MIT Sloan Prof. Renée Richardson Gosline

Gift giving can be fraught with anxiety, and Valentine’s Day gifts are no exception. If you decide to give a luxury item like jewelry or a designer handbag, the stakes can seem even higher. Naturally, it can be tempting to look for a “deal,” but buyer beware: If it seems too good to be true, it probably is, especially when it comes to counterfeit luxury goods. My research on the impact of counterfeiting on brands shows that the greatest risk in buying knockoffs is not to the brand, but to the user.

Why is this? First, counterfeits do not serve as substitutes for the real thing. Perhaps the biggest things that set luxury products apart from their imitators are quality and service. Design elements may be copied, but craftsmanship is difficult to replicate. That handbag found at a deep discount on eBay or at a street market may soon show signs of poor quality like frayed threading, broken straps, or ripped lining. Replacement time will be quicker since the counterfeit’s shelf life is shorter. Read More »

A Fashion Don’t: Why Partnerships Between Luxury Brands and Mass Retailers Often Fizzle–Renée Richardson Gosline

MIT Sloan Prof. Renée Richardson Gosline

From Huffington Post

My latest research* has to do with how people express themselves through the brands they consume. It’s a topic that has interested me for some time.

I grew up in Brooklyn, N.Y., the daughter of immigrants in a happy but definitely modest household. I didn’t go to a fancy high school — although, living in New York, I was very aware of fashion and labels. In fact, while riding the subway to school, I was regularly exposed to conspicuous consumption — from Wall Street bankers in their custom suits, to fashionistas who sported the latest styles. I got the distinct impression that “when you got it, you flaunt it.” So when I arrived for my freshman year at Harvard — the ultimate ivory tower and in a way itself a luxury brand — I had some pretty clear expectations of how people would signal their status. I had in mind something like Dan Ackroyd’s country club-going character Winthrop in the movie Trading Places. But what I saw got me thinking about what status signals really mean. Read More »

MIT Sloan grad on the “sharing economy,” the next big trend in social commerce

Jaime Contreras MBA '11 and Tal Snir MBA '11

My first entrepreneurial venture in the so-called “sharing economy” happened accidentally. It was 2009, and I had just moved to Cambridge, MA to start at MIT Sloan. I brought my car with me because I was sure I would need it. As it turned out, the only time I used it was to go grocery shopping; mostly it sat idle. Word got around that I had a car, and I soon found myself fielding requests to borrow it from friends. One suggested I charge for the privilege.

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Duncan Simester on customer response: Why guess and get it wrong when you could do a little experimenting and get it right?

MIT Sloan Prof. Duncan Simester

The business pages are filled with examples of companies that have taken big hits to their brands because they’ve made marketing decisions that ran afoul of customer expectations. Take Netflix, and its aborted scheme to divide its streaming and DVD video offerings. Netflix could have avoided its embarrassing reversal if it had experimented on this decision before publically announcing the change.

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Retaining or losing customers as they "churn" — Professor devises new competing risk model

MIT Sloan Assoc. Prof. Michael Braun

Businesses often spend a lot of money trying to retain customers. Many direct their retention activities toward all of their customers and hope that enough respond for the effort to pay off. But some customers leave anyway.  A more effective approach recognizes that customers are different and their likelihood of departing—a phenomenon known as churn in the business world—varies among individuals and over time.

Some customers churn for reasons a business can control. These customers may be unhappy with the price or product, or they may prefer a competitor. Others churn because they move away or die or go bankrupt—matters a business can’t control. An efficient strategy targets those customers likely to churn for controllable reasons and does not overspend on customers likely to leave for uncontrollable reasons. And when evaluating the success or failure of retention marketing activities, managers should take the incidence of uncontrollable churn into account.

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