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New research in consumer behavior from Harvard Business School faculty on issues including behavioral economics, brand loyalty, and how consumers determine the worth of a product.
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Burgers with Bugs? What Happens When Restaurants Ignore Online Reviews

by Kara Baskin

Negative Yelp reviews hold more sway with consumers than restaurateurs might think. A machine learning study by Chiara Farronato reveals how online platforms amplify the customer voice, and why business owners should listen.

Delivering a Personalized Shopping Experience with AI

Re: Jill J. Avery

THE YES, a shopping app for fashion brands, uses a sophisticated algorithm to create and deliver a personalized store for every shopper, based on her style preferences, size, and budget. After launching the app in 2020, the founders had to decide whether to continue developing the algorithm to deliver on the company’s customer value proposition or to focus their resources on new customer acquisition, with the idea that more users on the app would improve the algorithm's performance. Senior Lecturer Jill Avery and The YES co-founder and CEO Julie Bornstein discuss this make-or-break dilemma in the case, The YES: Reimagining the Future of e-Commerce with Artificial Intelligence (AI). This episode was recorded live at Harvard Business School on March 30, 2022 as part of our Case Method 100 celebration.

Why Companies Raise Their Prices: Because They Can

by Rachel Layne

Markups on household items started climbing years before the COVID-19 pandemic. Companies have realized just how much consumers will pay for the brands they love, says research by Alexander MacKay. Closed for comment; 0 Comments.

What Actually Draws Sports Fans to Games? It's Not Star Athletes.

by Rachel Layne

Team owners think they need marquee names or slick stadiums to prosper, but research by Karim Lakhani and Patrick Ferguson suggests that fans want something far simpler: suspense. Open for comment; 0 Comments.

IKEA Navigates the Future While Staying True to its Culture

Re: Juan AlcacerRe: Cynthia A. Montgomery

After years of success in providing quality furniture at affordable prices, Swedish furniture maker IKEA is challenged by the rise of online shopping and changing consumer behavior, plus the arrival of a new leader. The company's top executives know they had to step out of their comfort zones and embrace new strategic initiatives to stay relevant. But which initiatives will best enable IKEA to evolve while staying true to the company’s core values? Harvard Business School professors Juan Alcacer and Cynthia Montgomery discuss navigating a new future while preserving the company’s culture and identity in their case, “Which IKEA Do We Want?” Open for comment; 0 Comments.

Beyond Pajamas: Sizing Up the Pandemic Shopper

by Ayelet Israeli, Eva Ascarza, and Laura Castrillo

COVID-19 forced many shoppers to make their first online purchases. But will these customers stick around? Research by Ayelet Israeli, Eva Ascarza, and colleague. Open for comment; 0 Comments.

The Value of Descriptive Analytics: Evidence from Online Retailers

by Ron Berman and Ayelet Israeli

Analytics are descriptive when they describe what happened. Descriptive-analytics solutions are popular among marketers and retailers. This paper provides a benchmark for the benefits of using a descriptive dashboard and illustrates how to potentially extract these benefits.

'Repayment-by-Purchase' Helps Consumers to Reduce Credit Card Debt

by Grant E. Donnelly, Cait Lamberton, Stephen Bush, Zoe Chance, and Michael I. Norton

Many consumers fail to pay off credit card debt each month and suffer financial consequences. Repayment-by-purchase, allocating payment toward specific purchases on a credit card bill, helps consumers gain a sense of progress and control over credit card debt.

Accounting for Product Impact in the Consumer Finance Industry

by George Serafeim and Katie Trinh

A framework and method for measuring and monetizing product impact across industries, applying it to two competitors in the consumer finance space.

How Retailers Can Thrive in a Shopping Season Like No Other

by Danielle Kost

Is it the end of Black Friday as we know it? Harvard Business School faculty members share what retailers can expect from a holiday shopping season without precedent. Open for comment; 0 Comments.

What Can Economics Say About Alzheimer's Disease?

by Amitabh Chandra, Courtney Coile, and Corina Mommaerts

This essay discusses the role of market frictions and "missing medicines" in drug innovation and highlights how frameworks and toolkits of economists can help our understanding of the determinants and effects of Alzheimer's disease on health.

Consumers Punish Firms that Cut Employee Pay in Response to COVID-19

by Bhavya Mohan, Serena Hagerty, and Michael Norton

In the wake of COVID-19, firms announced both employee furloughs and (typically small) CEO wage cuts. This research shows that firms’ treatment of employees matters far more to consumers than executive pay cuts.

What Is an "Essential" Purchase for a Low-Income Family?

by Rachel Layne

Phone or flour? People with lower incomes are judged more harshly for what they choose to buy, say Serena F. Hagerty and Kate Barasz. Open for comment; 0 Comments.

Your Customers Have Changed. Here's How to Engage Them Again.

by Rohit Deshpandé, Ofer Mintz, and Imran S. Currim

The coronavirus makes your customers less able and less willing to spend than before. How should you re-engage with them? Advice from Rohit Deshpandé and colleagues. Open for comment; 0 Comments.

Coronavirus Careers: Cloud Kitchens Are Now Serving

by Lena Ye and Geoffrey Jones

Cloud kitchens are restaurants built around food delivery rather than sit-down service, and they are increasing in popularity as COVID-19 disrupts the industry, write Lena Ye and Geoffrey Jones. Open for comment; 0 Comments.

Why Privacy Protection Notices Turn Off Shoppers

by Michael Blanding

It seems counterintuitive, but website privacy protection notices appear to discourage shoppers from buying, according to Leslie John. Open for comment; 0 Comments.

From Sweetheart to Scapegoat: Brand Selfie-Taking Shapes Consumer Behavior

by Reto Hofstetter, Gabriela Kunath, and Leslie K. John

Using a dataset of more than 280,000 user reviews on Yelp, this paper describes a series of eight studies exploring how brand selfie-taking affects consumers’ behavior and sense of connection toward a brand.

Consumer Protection in an Online World: An Analysis of Occupational Licensing

by Chiara Farronato, Andrey Fradkin, Bradley Larsen, and Erik Brynjolfsson

This paper uses new data collected by a digital platform to study the role of occupational licensing laws on individual choices and market outcomes. Results suggest that more stringent licensing laws restrict competition but do not lead to improvements in customer satisfaction.

Does Apple Anchor a Shopping Mall? The Effect of the Technology Stores on the Formation of Market Structure

by Doug J. Chung, Kyoungwon Seo, and Reo Song

How do technology stores, particularly those owned by Apple and Microsoft, affect retail sales and market dynamics at malls? Through modeling and simulation, the authors found that these stores helped malls draw more high-income consumers, supporting the entry of upscale stores and exit of midscale and discount stores.

Do TV Debates Sway Voters?

by Danielle Kost

As Democratic presidential candidates face off at the podium, Vincent Pons reports that TV debates don’t influence voters. Open for comment; 0 Comments.