First Look

August 30, 2011

Leveraging Emotion In Tv Ads

Assistant Professor Thales S. Teixeira was instrumental in Harvard Business School acquiring an eye-tracking device for use in its experimental lab, and the machine is put to good use in a forthcoming article for Journal of Marketing Research. The research, reported under the title "Emotion-induced Engagement in Internet Video Ads," reports on how advertisers can use a viewer's emotional responses of joy and surprise to design more effective advertisements. Teixeira conducted the research with colleagues Michel Wedel and Rik Pieters.

L'oréal's Plan To Target 2 Billion Consumers

As a business goal, this one is a doozy: grow our customer base to 2 billion—almost a third of the planet's population—by 2020. But that's what one beauty care provider set out to accomplish, a decision chronicled in the new case study, "L'Oréal: Global Brand, Local Knowledge." The firm must build on and beyond its French cachet to attract "an aging population in the West, ethnic groups, aspiring and younger customers in the East, emerging markets, and growing interest in health and beauty care among men all over the world." Rebecca M. Henderson and Ryan Johnson wrote the case, which will help readers understand how a large company shifts marketing and messaging efforts in a changing world.

Assessing Ethnic Innovation In Us Firms

The impact of immigrant engineers and scientists on the US firms that hire them continues to be hotly debated, and HBS professors William Kerr and C. Fritz Foley are at the forefront of research that attempts to quantify that impact. In their new working paper, "Ethnic Innovation and U.S. Multinational Firm Activity," the authors address three main questions: 1. To what extent do innovators of a particular ethnicity enhance the competitiveness of US multinational in countries associated with that ethnicity? 2. How do these immigrants influence the global distribution of the multinational's research and development and patenting efforts? 3. Are US multinationals that employ innovators of a particular ethnicity less dependent on joint venture partners when forming new affiliates in countries associated with that ethnicity?

— Sean Silverthorne


Emotion-induced Engagement in Internet Video Ads


This study shows how advertisers can leverage emotion and attention to engage consumers in watching Internet video ads. In a controlled experiment, joy and surprise were assessed through automated facial expression detection for a sample of ads. Concentration of attention was assessed through eye tracking and retention of viewers by recording zapping behavior. This allows tests of predictions about the interplay of these emotions and inter-individual attention differences at each point in time during exposure. Surprise and joy effectively concentrate attention and retain viewers. But importantly, the level rather than the velocity of surprise impact attention concentration most, whereas the velocity rather than the level of joy impact viewer retention most. The effect of joy is asymmetric, with higher gains for increases than losses for decreases. Based on these findings, the authors develop representative emotion trajectories to support ad design and testing.


Working Papers

Ethnic Innovation and U.S. Multinational Firm Activity


This paper studies the impact that immigrant innovators have on the global activities of U.S. firms by analyzing detailed data on patent applications and on the operations of the foreign affiliates of U.S. multinational firms. The results indicate that increases in the share of a firm's innovation performed by inventors of a particular ethnicity are associated with increases in the share of that firm's affiliate activity in its native country. Ethnic innovators also appear to facilitate the disintegration of innovative activity across borders and to allow U.S. multinationals to form new affiliates abroad without the support of local joint venture partners. Thus, this paper points out that immigration can enhance the competitiveness of multinational firms.

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Cases & Course Materials

Kanebo Ltd. (A)

David F.Hawkins, Suraj Srinivasan, Akiko Kanno, and Lizzie Gomez
Harvard Business School Case 111-037

Speculation as to how Japanese companies might implement IFRS with particular emphasis on consolidation accounting.

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Perception and Readiness of Japanese Companies for IFRS Implementation: The Tokyo Stock Exchange Survey

David F. Hawkins and Jin Yamamoto
Harvard Business School Case 112-017

Tokyo Stock Exchange survey raises questions about Japan's readiness to adopt IFRS in 2016.

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Colgate-Palmolive: Staying Ahead in Oral Care

Rebecca M. Henderson and Ryan Johnson
Harvard Business School Case 311-120

In 2011, Colgate-Palmolive (Colgate) was the global leader in oral care, with a dominant market share lead in toothpaste and a growing presence in toothbrushes and mouthwash. However, the firm faced stiff competition with perennial rival P&G increasing its focus on the oral care and emerging markets where Colgate had traditionally been untouchable. To defend its lead Colgate attempted to cover all fronts, leveraging brand equity, fostering close relationships with dental professionals, innovating in underutilized markets, using its global network to quickly move products to market, and reinvesting steadily in its brand.

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L'Oréal: Global Brand, Local Knowledge

Rebecca M. Henderson and Ryan Johnson
Harvard Business School Case 311-118

Worldwide, and in the U.S. marketplace in particular, the French cachet of L'Oréal was one of its most powerful marketing tools. However, with the opening up of emerging markets, L'Oréal had to cater to a diverse customer base: an aging population in the West, ethnic groups, aspiring and younger customers in the East, emerging markets, and growing interest in health and beauty care among men all over the world. Employing both traditional and innovative marketing techniques, L'Oréal worked to double its customer base to two billion by 2020 and increase to half from a third its share of sales from emerging markets.

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Nestlé SA: Nutrition, Health and Wellness Strategy

Rebecca M. Henderson and Ryan Johnson
Harvard Business School Case 311-119

In 1997 Nestlé committed to a strategic vision of becoming the leading nutrition, health, and wellness (NHW) company in the world. Over the next 13 years, the NHW strategy guided strategic decisions and choices at Nestlé including merger and acquisition choices, strategies for improving products, and packaging innovations that helped Nestlé built credibility with the consumer in NHW, raised profit margins, continued strong growth, and differentiated the firm.

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Procter & Gamble: Marketing Capabilities

Rebecca M. Henderson and Ryan Johnson
Harvard Business School Case 311-117

P&G had become known and recognized as a marketing machine. It was the largest advertiser in the world, with 2010 spending of $8.68 billion. From the company's early exploitation of broadcast media (radio and television) for its soap products to more recent experiments in digital media for its men's hygiene brand Old Spice, P&G was a seasoned marketer with strong consumer research, a powerful innovation network, and the world's largest financial commitment to advertising.

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Reckitt Benckiser: Fast and Focused Innovation

Rebecca M. Henderson and Ryan Johnson
Harvard Business School Case 311-116

Since its 1999 merger Reckitt Benckiser (RB), a global consumer goods company, led by its CEO Bart Becht, developed a reputation for rapid product innovation and industry leading profit margins. RB's stated strategy was to focus on its Powerbrands and high growth categories and to nurture the Powerbrands with innovation and roll them out globally. The Powerbrands had steady double digit growth year over year, attracted a devoted customer base, and typically grabbed high margins. This case examines the Powerbrands strategy, RB's devotion to fast and focused innovation, and its execution of that strategy.

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sweetriot 2.0.

Christopher Marquis, Donna Khalife, and Bobbi Thomason
Harvard Business School Case 412-007

In the fall of 2010, Sarah Endline, CEO and founder of sweetriot, an organic chocolate company, was deciding the best way to grow her organic chocolate company, while keeping her chocolate physically and conceptually on the shelf. She wanted to grow the offerings and profits of her company, while maintaining its social mission and unique flair. The case tracks the origins of sweetriot from Sarah's formative early career experiences, to the company's launch and beyond as Sarah prepares future products, establishes production channels, and seeks future funding. Sarah was not content to just be a small New York City candy company. Her goal was for sweetriot to be the number one natural chocolate company in the world and to thus be a vehicle to drive change globally. How can she meet that objective while also keeping the company true to its social roots?

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Renewing GE: The Africa Project (B)

David A. Thomas and Stephanie J. Creary
Harvard Business School Supplement 412-028

This case continues the story of the evolution of GE's business initiatives Africa. Between November 2010 and March 2011 several significant structural changes and leadership appointments were announced at GE, which reflected the company's commitment to global growth in all its regions outside the U.S., including its business in sub-Saharan Africa. In November 2010, John Rice, vice chairman of GE and president and CEO of GE Technology Infrastructure, was named vice chairman of GE and president and CEO of Global Growth and Operations (GGO). In this new role, Rice was based in Hong Kong and in charge of GE's growth in regions outside the U.S. In March 2011, Jay Ireland, a 31-year GE veteran and corporate officer, was appointed president and CEO for GE Africa, effective April 15, reporting to Rice. Additionally, three senior executives were appointed to Ireland's team: Lazarus Angbazo was promoted from president and CEO, sub-Saharan Africa, to president and CEO, GE West, East & Central Africa and Africa commercial leader; Thomas Konditi, a native of Kenya, rejoined GE as CFO for Global Growth and Operations, GE Africa; and Tamla Oates-Forney was promoted from human resources leader for sub-Saharan Africa, GE Energy, to senior human resources manager, GE Africa. While many were optimistic about GE's future in Africa, several issues still needed to be considered.

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Shifting the Diversity Climate: The Sodexo Solution

David A. Thomas and Stephanie J. Creary
Harvard Business School Case 412-020

This case profiles the evolution of Sodexo's diversity initiative. Diversity became a key priority for Sodexo, North America in 2001 after a class-action lawsuit was filed and certified in Washington, D.C. against Sodexo Marriot Services, Inc., the food services division that Sodexo had merged with in 1998. In 2002, Dr. Rohini Anand was hired by Michel Landel, CEO of Sodexo, North America. Soon thereafter, Anand was instated as chief diversity officer for Sodexo, North America. Anand and Landel worked with several executives to develop and implement systems that were conducive to a diversity strategy. The team started to build the human resource processes that would address many of the concerns in the lawsuit: training systems, selection systems, and a career posting center. By 2010, Sodexo, North America was continuing to gain traction on its diversity strategy, and a global diversity initiative for the group was underway. In addition, the company had developed diversity priorities focused on five different dimensions of difference from a global perspective: gender, race/ethnicity, sexual orientation, disabilities, and age. However, more work still needed to be done to engage employees around the world in the company's diversity initiatives.

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Teach Plus: Mobilizing a New Generation of Teacher Leaders

David A. Thomas and Stephanie J. Creary
Harvard Business School Case 412-027

This case profiles the evolution of Teach Plus, a non-profit organization founded on the premise that in order for public schools to continuously improve urban student achievement, teaching must become a career that motivates and retains effective early career teachers. Teach Plus began as a pilot in fall 2007, launched by Celine Coggins, a former teacher and labor-management consultant, and incubated at the Rennie Center for Education Research and Policy in Cambridge, Massachusetts. In August 2009, Teach Plus became an independent 501 c3 with Coggins as CEO and Monique Burns Thompson, a social entrepreneur and former school district administrator as president. Since its inception, Teach Plus had demonstrated that its approach was effective in helping teachers to understand and directly influence policy. Through the T + Network, Teach Plus found evidence that reform-minded teachers existed in large numbers throughout urban school districts and that many were willing to share their perspectives with policymakers. Through the development of a public school turnaround initiative in Boston, Teach Plus showed that teacher-driven policy initiatives filled an important gap in the education reform landscape. By mid-2011, Teach Plus had grown to a network of more than 3,500 reform-minded teachers in five cities. While Teach Plus had reached significant scale in its first 18 months of operations, it also faced a significant strategic challenge. Moving forward, would Teach Plus best address its agenda as a "voice/advocacy" organization or as a "teacher turnaround" organization?

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Bridge International Academies: A School in a Box

V. Kasturi Rangan and Katharine Lee
Harvard Business School Case 511-064

Bridge International was founded in 2007 as a for-profit social enterprise to address the educational needs of poor children in Africa. Ten schools were operational in Kenya by 2010. The plan was to franchise nearly 3,000 schools all over Africa. The case is meant to discuss the challenges of scaling.

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