The Yelp Factor: Are Consumer Reviews Good for Business?
| Published: | October 24, 2011 |
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| Feature: | Research & Ideas |
| Forum: | open for comment; 13 Comments posted |
In a new study, Assistant Professor Michael Luca shows just how much restaurant reviews on Yelp affect companies' bottom lines. The more difficult question: Are these ratings reliable as a measure of product quality?
Reviews, Reputation, and Revenue: The Case of Yelp.com
| Author: | Michael Luca |
|---|---|
| Published: | October 4, 2011 |
| Paper Release Date: | September 2011 |
| Feature: | Working Papers |
In just six years, Yelp.com has managed to crowdsource 20 million reviews of restaurants and other services by creating and leveraging an impressive social network of people who enjoy writing reviews. But can a bunch of amateur opinionators working for free really transform the restaurant industry, where heavily marketed chains and highly regarded professional critics have long had a stronghold? To answer this question, HBS professor Michael Luca combined Yelp reviews with revenues for every restaurant that operated in Seattle, WA at any point between 2003 and 2009. Applying a new method to tease out the causal effect of reviews (separate from the effect of underlying quality), the study shows that a one-star increase on Yelp leads to a 5 to 9 percent increase in revenue. Yet Yelp doesn't work for all restaurants. Chain restaurants —which already spend heavily on branding —are unaffected by changes in their Yelp ratings. This suggests that consumer reviews present a new way of learning in the Internet age, and are fast becoming a substitute for traditional forms of reputation.
KFC's Explosive Growth in China
| Published: | June 17, 2011 |
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| Feature: | HBS Cases |
| Forum: | open for comment; 19 Comments posted |
In China, Yum! Brands is opening a KFC store every day. But this is not the KFC you know in America. A recent case study written by professor David Bell and Agribusiness Program director Mary Shelman reveals how the chicken giant adapted its famous fast-food formula for the local market.
Clay Christensen's Milkshake Marketing
| Published: | February 14, 2011 |
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| Feature: | Research & Ideas |
| Forum: | open for comment; 102 Comments posted |
About 95 percent of new products fail. The problem often is that their creators are using an ineffective market segmentation mechanism, according to HBS professor Clayton Christensen. It's time for companies to look at products the way customers do: as a way to get a job done.
Published in 2010
Introverts: The Best Leaders for Proactive Employees
| Published: | October 4, 2010 |
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| Feature: | Research & Ideas |
| Forum: | open for comment; 94 Comments posted |
Think effective leadership requires gregariousness and charisma? Think again. Introverts actually can be better leaders than extraverts, especially when their employees are naturally proactive, according to Harvard Business School professor Francesca Gino.
Published in 2009
Customer Feedback Not on elBulli's Menu
| Published: | November 18, 2009 |
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| Feature: | HBS Cases |
The world is beating a path to Chef Ferran Adrià's door at elBulli, but why? In professor Michael Norton's course, students learn about marketing from a business owner who says he doesn't care whether or not customers like his product.
Published in 2008
Testing Strategy with Multiple Performance Measures Evidence from a Balanced Scorecard at Store24
| Authors: | Dennis Campbell, Srikant M. Datar, Susan L. Kulp, and V.G. Narayanan |
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| Published: | May 22, 2008 |
| Paper Release Date: | February 2008 |
| Feature: | Working Papers |
To what extent do balanced scorecards provide useful information for testing and validating an organization's strategy? Numerous case studies of balanced scorecard implementations document their use in translating organizational strategies to objectives and measures, communicating strategic objectives to employees, evaluating the performance of business units, and aligning the incentives of employees across business units and functions. There has been comparatively little research, however, on the potential learning and feedback role of balanced scorecards. Analyzing balanced scorecard data from Store24—a privately held convenience store retailer in New England—during the implementation of an innovative but ultimately unsuccessful strategy, this study investigates whether, when, and how information about problems with the firm's strategy was captured in the multiple performance measures of its balanced scorecard.
Organizational Design and Control across Multiple Markets: The Case of Franchising in the Convenience Store Industry
| Authors: | Dennis Campbell, Srikant M. Datar, and Tatiana Sandino |
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| Published: | May 8, 2008 |
| Paper Release Date: | April 2008 |
| Feature: | Working Papers |
Chain organizations operate units that are typically dispersed across different types of markets, and thus serve significantly different customer bases. Such "market-type dispersion" is likely to compromise the headquarters' ability to control its stores for two reasons: Relative differences in local conditions make it difficult to monitor a store manager's behavior, and a chain with wide-ranging customer bases will have a harder time serving its customers and will need to rely more heavily on store managers' ability to adapt to local needs. This study identifies market-type dispersion as a factor that is systematically related to firms' organizational design choices. The results may help managers and consultants who deal with control challenges related to a chain's geographic expansion into different markets.
Finding Missing Markets (and a disturbing epilogue): Evidence from an Export Crop Adoption and Marketing Intervention in Kenya
| Authors: | Nava Ashraf, Xavier Giné, and Dean Karlan |
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| Published: | March 11, 2008 |
| Paper Release Date: | February 2008 |
| Feature: | Working Papers |
Why do farmers continue to grow crops for local markets when crops for export markets are thought to be much more profitable? Answers may include missing information about the profitability of these crops, lack of access to the necessary capital to make the switch possible, lack of infrastructure necessary to bring the crops to export outlets, high risk of the export markets, lack of human capital necessary to adopt successfully a new agricultural technology, and misperception by researchers and policymakers about the true profit opportunities and risk of crops grown for export markets. Ashraf and colleagues conducted an experimental trial with DrumNet, a social enterprise of Pride Africa, a nongovernmental organization, to evaluate whether a package of services can help farmers adopt, finance, and market export crops, and thus earn more income. This experiment was motivated by a recent push in development to build sustainable interventions that help complete missing markets.
Published in 2007
The FDA: What Will the Next 100 Years Bring?
| Q&A with: | Arthur A. Daemmrich |
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| Published: | September 24, 2007 |
| Feature: | Research & Ideas |
With the possible exception of the Internal Revenue Service, no other governmental agency touches the lives of more Americans than the U.S. Food and Drug Administration, which ensures the safety of $1.5 trillion worth of consumer goods and medicines. Harvard Business School professor Arthur A. Daemmrich discusses the impact and challenges of the agency and his new book, Perspectives on Risk and Regulation: The FDA at 100.
I'll Have the Ice Cream Soon and the Vegetables Later: Decreasing Impatience over Time in Online Grocery Orders
| Authors: | Todd Rogers, Katherine L. Milkman, and Max H. Bazerman |
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| Published: | May 15, 2007 |
| Paper Release Date: | April 2007 |
| Feature: | Working Papers |
How do people's preferences differ when they make choices for the near term versus the more distant future? Providing evidence from a field study of an online grocer, this research shows that people act as if they will be increasingly virtuous the further into the future they project. Researchers examined how the length of delay between when an online grocery order is completed and when it is delivered affects what consumers order. They find that consumers purchase more "should" (healthy) groceries such as vegetables and less "want" (unhealthy) groceries such as ice cream the greater the delay between order completion and order delivery. The results have implications for public policy, supply chain managers, and models of time discounting.
Published in 2004
Marketing Wine to the World
| Q&A with: | Michael Roberto |
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| Published: | February 16, 2004 |
| Feature: | Research & Ideas |
From consolidation to the growing clout of mass retailers, structural changes have hit the wine industry. Professor Michael Roberto discusses the move from elitism to mainstream appeal.
Published in 2002
Unilever—A Case Study
| Published: | December 9, 2002 |
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| Feature: | Research & Ideas |
As one of the oldest and largest foreign multinationals doing business in the U.S., the history of Unilever's investment in the United States offers a unique opportunity to understand the significant problems encountered by foreign firms. Harvard Business School professor Geoffrey Jones has done extensive research on Unilever, based on full access to restricted corporate records. This recent article from Business History Review is the first publication resulting from that research.
How a Juicy Brand Came Back to Life
| Published: | February 4, 2002 |
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| Feature: | Research & Ideas |
"Some brands just want to have fun, and from birth Snapple was one of them," says HBS professor John Deighton. As he explains in this excerpt from Harvard Business Review, the odyssey of the fun-loving beverage contains smart lessons for managers on branding and company culture.
