• Title/Summary/Keyword: consumer risk

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Comparative Analysis of Detection Methods for Food-borne Pathogens in Fresh-cut Agricultural Materials (신선 농산물내 식중독균 검출 방법의 비교 분석)

  • Jang, Hye-Jeong;Kim, Hye-Jeong;Park, Ji-in;Yu, Sun-Nyoung;Park, Bo-Bae;Ha, Gang-Ja;Ahn, Soon-Cheol;Kim, Dong-Seob
    • Journal of Life Science
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    • v.31 no.1
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    • pp.10-16
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    • 2021
  • The consumption of fresh-cut agricultural materials is increasing due to increased public interest in health and the increase of single-person households. Most fresh-cut agricultural materials can be eaten without heating, thus easily exposing the consumer to food-borne pathogens. As a result, food-borne diseases are increasing worldwide. In the analysis of food-borne pathogens, it is important to detect the strains, but this is time consuming and laborious. Alternative detection methods that have been introduced, include polymerase chain reaction-denaturing gradient gel electrophoresis (PCR-DGGE), which is performed without prior culturing. Samples of fresh-cut agricultural materials, such as vegetables, were analyzed by the culture-based method. In 129 samples, non-pathogenic Escherichia coli (3.9%), Bacillus cereus (31.8%), Clostridium perfringens (5.4%), Yersinia enterocolitica (0.8%), and enterohemorrhagic E. coli (0.8%) were detected. Eight samples contaminated with bacteria were randomly selected, further analyzed by PCR-DGGE, and compared with the culture-based method. Two cases detected non-pathogenic E. coli by PCR-DGGE only, despite a lack of detection by the culture method. It was supposed there was possibility of sample loss during its 10-fold dilution for appropriate cultivation. In the detection of high-risk food-borne pathogens, it was found that the detection limit was lower in PCR-DGGE than in the culture-based method (10 CFU/g). This suggests that PCR-DGGE can be alternatively used to detect strains. On the other hand, low-risk food-borne pathogens seem to have higher detection limits in PCR-DGGE. Consequentially, this study contributes to the improvement of food-borne pathogen detection and the prevention of its related-diseases in fresh-cut agricultural materials.

A Study on Consumer's Emotional Consumption Value and Purchase Intention about IoT Products - Focused on the preference of using EEG - (IoT 제품에 관한 소비자의 감성적 소비가치와 구매의도에 관한 연구 - EEG를 활용한 선호도 연구를 중심으로 -)

  • Lee, Young-ae;Kim, Seung-in
    • Journal of Communication Design
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    • v.68
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    • pp.278-288
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    • 2019
  • The purpose of this study is to analyze the effects of risk and convenience on purchase intention in the IOT market, and I want to analyze the moderating effect of emotional consumption value. In this study, two products were selected from three product groups. There are three major methods of research. First, theoretical considerations. Second, survey analysis. Reliability analysis and factor analysis were performed using descriptive statistics using SPSS. Third, we measured changes of EEG according to in - depth interview and indirect experience. As a result of the hypothesis of this study, it was confirmed that convenience of use of IoT product influences purchase intention. Risk was predicted to have a negative effect on purchase intentions, but not significant in this study. This implies that IoT products tend to be neglected in terms of monetary loss such as cost of purchase, cost of use, and disposal cost when purchasing. In-depth interviews and EEG analysis revealed that there is a desire to purchase and try out the IoT product due to the nature of the product, the novelty of new technology, and the vague idea that it will benefit my life. The aesthetic, symbolic, and pleasure factors, which are sub - elements of emotional consumption value, were found to have a great influence. This is consistent with previous research showing that emotional consumption value has a positive effect on purchase intention. In-depth interviews and EEG analyzes also yielded the same results. This study has revealed that emotional consumption value affects the intention to purchase IoT products. It seems that companies producing IoT products need to concentrate on marketing with more emotional consumption value.

Concerning the Constitution Court's constitutional decision and the direction of supplemental legislation concerning Article 33 paragraph 8 of the Medical Service Act - With a focus on legitimacy of a system that prohibits multiple opening of medical instituion, in the content of 2014Hun-Ba212, August 29, 2019, 2014Hun-Ga15, 2015Hun-Ma561, 2016Hun-Ba21(amalgamation), Constitutional Court of Korea - ('의료법 제33조 제8항 관련 헌법재판소의 합헌결정'에 대한 평가 및 보완 입법 방향에 대하여 -헌법재판소 2019. 8. 29. 2014헌바212, 2014헌가15, 2015헌마561, 2016헌바21(병합) 결정의 내용 중 의료기관 복수 개설금지 제도의 당위성 및 필요성을 중심으로-)

  • KIM, JOON RAE
    • The Korean Society of Law and Medicine
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    • v.20 no.3
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    • pp.143-174
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    • 2019
  • Our Constitution obliges the state to protect the health of the people, and the Medical Law, which embodied Constitution, sets out in detail the matters related to open the medical institution, and one of them is to prohibit the operation of multiple medical institutions. By the way, virtually multiple medical institutions could be opened and operated because the Supreme Court had interpreted that several medical institutions could be opened if medical activities were not performed directly at the additional medical institution which was opened under the another doctor's license. However, some health care providers opened the several medical institutions with another doctor's license for the purpose of the maximization of profit, and did illegal medical cares like the unfair luring of patients, over-treatment, and commission treatment. Also, realistic problems such as the infringed health rights have arisen. Accordingly, lawmakers had come to amend the Medical Law to readjust the system of opening for medical institution so that medical personnel could not open or operate more than one medical institution for any reason. For this reason, the Constitutional Court recently declared a constitutional decision through a long period of in-depth deliberation because the constitutional petition and the adjudication on the constitutionality of statutes had been filed on whether Article 33 paragraph 8 of the revised medical law is unconstitutional. The Constitutional Court acknowledged the "justice of purpose" in view of the importance of public medical institutions, of the prevention from seduction of for-profit patients and from over-treatment, and of the fact that health care should not be the object of commercial transactions. Given the risk that medical personnel might be subject to outside capital, the concern that the holder of the medical institution's opening certificate and the actual operator may be separated, the principle that the human body and life should not be just a means, and the current system's inability to identify over-treatment, it also acknowledged the 'minimum infringement'. Furthermore, The Constitutional Court judged it is constitutional in compliance with the principle of restricting fundamental rights, such as 'balance of legal interests'. In this regard, legislative complements are needed in order to effectively prevent the for-profit management and the over-treatment the Constitutional Court is concerned about. In this regard, consumer groups actively support the need for legislation, and health care providers groups also agree on the need for legislation. Therefore, the legislators should respect the recent Constitutional Court's decision and in the near future complete the complementary legislation to reflect the people's interests.

A Study on the Effects of Meterological Factors on the Distribution of Agricultural Products: Focused on the Distribution of Chinese Cabbages (기상요인이 농산물 유통에 미치는 영향에 관한 연구: 배추 유통 사례를 중심으로)

  • Lee, Hyunjoung;Hong, Jinhwan
    • Journal of Distribution Research
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    • v.17 no.5
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    • pp.59-83
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    • 2012
  • Agriculture is a primary industry that influenced by the weather or meterological factors more than other industry. Global warming and worldwide climate changes, and unusual weather phenomena are fatal in agricultural industry and human life. Therefore, many previous studies have been made to find the relationship between weather and the productivity of agriculture. Meterological factors also influence on the distribution of agricultural product. For example, price of agricultural product is determined in the market, and also influenced by the weather of the market. However, there is only a few study was made to find this link. The objective of this study is to investigate the effects of meterological factors on the distribution of agricultural products, focusing on the distribution of chinese cabbages. Chinese cabbage is a main ingredient of Kimchi, and basic essential vegetable in Korean dinner table. However, the production of chinese cabbages is influenced by weather and very fluctuating so that the variation of its price is so unstable. Therefore, both consumers and farmers do not feel comfortable at the unstable price of chinese cabbages. In this study, we analyze the real transaction data of chinese cabbage in wholesale markets and meterological factors depending on the variety and geography. We collect and analyze data of meterological factors such as temperatures, humidity, cloudiness, rainfall, snowfall, wind speed, insolation, sunshine duration in producing and consuming region of chinese cabbages. The result of this study shows that the meterological factors such as temperature and humidity significantly influence on the volume and price of chinese cabbage transaction in wholesale market. Especially, the weather of consuming region has greater correlation effects on transaction than that of producing region in all types of chinese cabbages. Among the whole agricultural lifecycle of chinese cabbages, 'seeding - harvest - shipment - wholesale', meterological factors such as temperature and rainfall in shipment and wholesale period are significantly correlated with transaction volume and price of crops. Based on the result of correlation analysis, we make a regression analysis to verify the meterological factors' effects on the volume and price of chines cabbage transaction in wholesale market. The results of stepwise regression analysis are shown in

    and
    . The type of chinese cabbages are categorized by 5 types, i.e. alpine, gimjang for winter, spring, summer, and winter crop, and all of the regression models are shown significant relationship. In addition, meterological factors in shipment and wholesale period are entered more in regression model than those in seeding and harvest period. This result implies that weather in consuming region is also important in the distribution of chinese cabbages. Based on the result of this study, we find several implications and recommendations for policy makers of agricultural product distribution. The goal of agricultural product distribution policy is to insure proper price and production cost for farmers and provide proper price and quality, and stable supply for consumers. Therefore, coping with the uncertainty of weather is very essential to make a fruitful effect of the policy. In reality, very big part of consumer price of chinese cabbage is made up of the margin of intermediaries, because they take the risk. In addition, policy makers make efforts for farmers to utilize AWIS (Agricultural Weather Information System). In order to do that, it should integrate the relevant information including distribution and marketing as well as production. Offering a consulting service to farmers about weather management is also expected to be a good option in agriculture and weather industry. Reflecting on the result of this study, the distribution authorities can offer the guideline for the timing and volume of harvest, and it is expected to contribute to the stable equilibrium of supply and demand of agricultural products.

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  • Analysis and Safety Assessment of Antioxidants Migrated from Polyethylene and Polypropylene Food Packaging Materials into Food Simulants (폴리에틸렌 및 폴리프로필렌 기구·용기·포장 유래 산화방지제 분석 및 안전성평가)

    • Choi, Heeju;Choi, Jae Chun;Bae, In-Ae;Park, Se-Jong;Kim, MeeKyung
      • Journal of Food Hygiene and Safety
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      • v.32 no.5
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      • pp.424-433
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      • 2017
    • Antioxidants are used in the manufacturing of commercial food packages made of polyolefin plastic such as polyethylene and polypropylene for the purpose to delay the oxidation reaction of the polymer due to oxygen or traces of ozone in the atmosphere. Additives in plastics may be migrated from the packaging materials into foods, thereby presenting a potential health risk to the consumer. Therefore, it is necessary to determine migration level of antioxidants from food packaging materials to foodstuffs in order to take proactive management. In this study, we have developed a method for the analysis of 10 antioxidants, which are butylated hydroxyanisole (BHA), butylated hydroxytoluene (BHT), Cyanox 2246, 425 and 1790, Irgafos 168, and Irganox 1010, 1330, 3114 and 1076, migrated from the food packaging materials into four food simulants for aqueous, acidic, alcoholic and fatty foods. The antioxidants were determined by reversed-phase high-performance liquid chromatograph-ultraviolet detector with 276 nm after solid-phase extraction with a hydrophilic-lipophilic balance (HLB) cartridge or dilution with isopropanol. The analytical method showed a good linearity of coefficient ($R^2{\geq}0.99$), limits of detection (0.11~0.41 mg/L), and limits of quantification (0.34~1.24 mg/L). The recoveries of antioxidants spiked to four food simulants ranged from 71.3% to 109.4%. The migrated antioxidants in this study were within the safety levels that resulted from the safety assessment by the estimated daily intake to the tolerable daily intake.

    Elucidation of Dishes High in N-Nitrosamines Using Total Diet Study Data (총식이조사 자료를 이용한 음식별 니트로사민 함량 분포 규명)

    • Choi, Seul Ki;Lee, Youngwon;Seo, Jung-eun;Park, Jong-eun;Lee, Jee-yeon;Kwon, Hoonjeong
      • Journal of Food Hygiene and Safety
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      • v.33 no.5
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      • pp.361-368
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      • 2018
    • N-nitrosamines are probable or possible human carcinogens, which are produced by the reaction between secondary amines and nitrogen oxide in the acidic environment or by heating. Common risk assessment procedure involves the comparison between exposures expressed in the unit, mg/kg body weight/day and the Health-Based Reference dose expressed in the same unit. This procedure is suitable for the policy decision-making and is considered as inappropriate for the consumers to get information about their dietary decision-making. Therefore, the distributions of NDMA (N-nitrosodimethylamine), NDBA (N-nitrosodibutylamine), the six N-nitrosamines (NDMA, NDBA, NDEA (N-nitrosodiethylamine), NPYR (N-nitrosopyrrolidine), NPIP (N-nitrosopiperidine), and NMOR (N-nitrosomorpholine) in the menus grouped based on the presence of main ingredients and cooking methods were analyzed to generate consumer-friendly information regarding food contaminants. Recipes and intakes were taken from 2014 to 2016 KNHANES (The Korean National Health and Nutrition Examination Survey) and only the data from ages of 7 years or older were used. The contamination data were collected from the 2014~2016 Total Diet Study and all the analysis were performed using R software. Rockfish, eel, anchovy broth and pollock were mainly exposed to N-nitrosamines. In terms of cooking methods, soups and stews appeared to contain the highest amount of N-nitrosamines. Cereals, fruits, and dairy products in the ingredient categories, and rice dishes and rice combined with others in recipe categories had the lowest level exposure to N-nitrosamines. In case of N-nitrosamines, unlike other cooking related food contaminants, boiled dishes such as soups and stews and dishes mainly consisting of fishes and shellfishes had highest level of exposure, showing a large discrepancy with the previous thought of processed meat is the main source of N-nitrosamines.

    Strategies of Large Park Development and Management through Governance - Case Studies of The Presidio and Sydney Harbour National Park - (거버넌스를 통한 대형 도시공원의 조성 및 운영관리 전략 - 프레시디오 공원과 시드니 하버 국립공원 사례를 중심으로 -)

    • Sim, Joo-Young;Zoh, Kyung-Jin
      • Journal of the Korean Institute of Landscape Architecture
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      • v.44 no.6
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      • pp.60-72
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      • 2016
    • This study aims to suggest strategies of development and management for large parks by examining experimental cases of park governance models related to a shift away from public administration. The shifts towards governance as well as public-private partnership in city parks have involved the need for new public management. This study has analyzed two exemplary cases of Presidio Park and Sydney Harbour National Park in the aspects of planning process and management strategies, as the results derived the meaning and effect of park governance management and is also an essential prerequisite for the achievement of the model. There are six dimensions of research frames--namely policy, governance, partnership, finances and funds, design and maintenance-management, and evaluation-monitoring-taken as the basis for this study. Through the analysis, several key characteristics of these cases were elicited. First, the park planning process must be consistent in carrying a policy from planning to implementation, and furthermore, an independent operation body which can properly authorize an execution and uphold its responsibility from the public could serve in adaptable park services. Second, it has been suggested to build various partnerships with PAs and NGOs, private corporations, community groups, and academic institutes that allow it to expand the diversity of the park activities. Third, there has been experimental exploration to achieve a financially self-sufficient model by establishing internal revenue models and hence allow the reduction of reliance on public finances. The result of this type of park management would allow for improving park quality and make the park space a vital part of the local economy. Fourth, the strategies for a local community's participation are needed to allow the community to become a producer as well as a consumer. This study shows that the direction and significance of the park governance model regarding the fact that the plans sought by the two parks are extending the layout of public-centered discussion to the private sector and the third non-governmental sector including to the local community group. This shows both implications and limitations, such as the risk of privatization through non-governmental activities at the park or the violation of essential functions as a public good due to a profit-generating management policy for securing financial self-sufficiency. At the current point in which plans are under way for the development and management of large parks, a park governance model requires continuous study and expansion of discussion in the future.

    A Study on Personalized Product Demand Manufactured by Smart Factory (스마트팩토리 환경의 개인맞춤형 제품 구매의도의 영향요인에 관한 연구)

    • Woo, Su-Han;Kwon, Sun-Dong
      • Management & Information Systems Review
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      • v.38 no.1
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      • pp.23-41
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      • 2019
    • Smart Factory is different from existing factory automation in that it aims to produce personalized products with minimum time and cost through ICT. However, previous researches, not from consumers but from product suppliers, have focused on technology trends and technology application methods. In order for Smart Factory to be successful, it must go beyond supplier-focus to meet the needs of consumers. In this study, we surveyed the purchase intention of the personalized product manufactured by smart factory. Influencing factors of purchase intention were drawn as consumers' need for uniqueness, innovativeness, need for touch, and privacy concern, based on previous research. As results of data analysis, it was confirmed that respondents were willing to purchase personalized products, and that consumers' need for uniqueness, innovativeness, and need for touch had a significant impact on purchase intention of personalized products. Our findings can be summarized as follows. First, Consumers' need for uniqueness was found to have positive effects(${\beta}=0.168$) on purchase intention of personalized products. The desire to differentiate themselves from others will be reflected in their personalized products. Therefore, consumers with a higher desire for uniqueness tend to be more willing to purchase personalized products. Second, consumer innovativeness was found to have positive effects(${\beta}=0.233$) on purchase intention of personalized products. Personalized shoes suggested in this study is a new type of personalized product that is manufactured by the latest information and communication technologies such as multi-function robots and 3D printing. Therefore, consumers seeking innovative new experiences are more willing to purchase personalized products. Third, need for touch was found to have positive effects(${\beta}=0.299$) on purchase intention of personalized products. In a smart factory environment, prosuming participation is given to consumers. If consumers participate in the product development process and reflect their requirements on the product, they are expected to increase their purchase intention by virtually satisfying the need for touch. Fourth, privacy concern was found to have no significantly related to purchase intention of personalized products. This is interpreted as a willingness to tolerate the risk of exposing personal information such as home address, telephone number, body size, and preference for consumers who feel highly useful in personalized products.

    Shopping Value, Shopping Goal and WOM - Focused on Electronic-goods Buyers (쇼핑 가치 추구 성향에 따른 쇼핑 목표와 공유 의도 차이에 관한 연구 - 전자제품 구매고객을 중심으로)

    • Park, Kyoung-Won;Park, Ju-Young
      • Journal of Global Scholars of Marketing Science
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      • v.19 no.2
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      • pp.68-79
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      • 2009
    • The interplay between hedonic and utilitarian attributes has assumed special significance in recent years; it has been proposed that consumption offerings should be viewed as experiences that stimulate both cognitions and feelings rather than as mere products or services. This research builds on previous work on hedonic versus utilitarian benefits, regulatory focus theory, customer satisfaction to address two question: (1) Is the shopping goal at the point of purchase different from the shopping value? and (2) Is the customer loyalty after the use different from the shopping value and shopping goal? We surveyed 345 peoples those who have bought the electronic-goods within 6 months. This research dealt with the shopping value which is consisted of 2 types, hedonic and utilitarian. Those who pursue the hedonic shopping value may prefer the pleasure of purchasing experience to the product itself. They tend to prefer atmosphere, arousal of the shopping experience. Consistent with previous research, we use the term "hedonic" to refer to their aesthetic, experiential and enjoyment-related value. On the contrary, Those who pursue the utilitarian shopping value may prefer the reasonable buying. It may be more functional. Consistent with previous research, we use the term "utilitarian" to refer to the functional, instrumental, and practical value of consumption offerings. Holbrook(1999) notes that consumer value is an experience that results from the consumption of such benefits. In the context of cell phones for example, the phone's battery life and sound volume are utilitarian benefits, whereas aesthetic appeal from its shape and color are hedonic benefits. Likewise, in the case of a car, fuel economics and safety are utilitarian benefits whereas the sunroof and the luxurious interior are hedonic benefits. The shopping goals are consisted of the promotion focus goal and the prevention focus goal, based on the self-regulatory focus theory. The promotion focus is characterized into focusing ideal self because they are oriented to wishes and vision. The promotion focused individuals are tend to be more risk taking. They are more sensitive to hope and achievement. On the contrary, the prevention focused individuals are characterized into focusing the responsibilities because they are oriented to safety. The prevention focused individuals are tend to be more risk avoiding. We wanted to test the relation among the shopping value, shopping goal and customer loyalty. Customers show the positive or negative feelings comparing with the expectation level which customers have at the point of the purchase. If the result were bigger than the expectation, customers may feel positive feeling such as delight or satisfaction and they would want to share their feelings with other people. And they want to buy those products again in the future time. There is converging evidence that the types of goals consumers expect to be fulfilled by the utilitarian dimension of a product are different from those they seek from the hedonic dimension (Chernev 2004). Specifically, whereas consumers expect the fulfillment of product prevention goals on the utilitarian dimension, they expect the fulfillment of promotion goals on the hedonic dimension (Chernev 2004; Chitturi, Raghunathan, and Majahan 2007; Higgins 1997, 2001) According to the regulatory focus theory, prevention goals are those that ought to be met. Fulfillment of prevention goals in the context of product consumption eliminates or significantly reduces the probability of a painful experience, thus making consumers experience emotions that result from fulfillment of prevention goals such as confidence and securities. On the contrary, fulfillment of promotion goals are those that a person aspires to meet, such as "looking cool" or "being sophisticated." Fulfillment of promotion goals in the context of product consumption significantly increases the probability of a pleasurable experience, thus enabling consumers to experience emotions that result from the fulfillment of promotion goals. The proposed conceptual framework captures that the relationships among hedonic versus utilitarian shopping values and promotion versus prevention shopping goals respectively. An analysis of the consequence of the fulfillment and frustration of utilitarian and hedonic value is theoretically worthwhile. It is also substantively relevant because it helps predict post-consumption behavior such as the promotion versus prevention shopping goals orientation. Because our primary goal is to understand how the post consumption feelings influence the variable customer loyalty: word of mouth (Jacoby and Chestnut 1978). This research result is that the utilitarian shopping value gives the positive influence to both of the promotion and prevention goal. However the influence to the prevention goal is stronger. On the contrary, hedonic shopping value gives influence to the promotion focus goal only. Additionally, both of the promotion and prevention goal show the positive relation with customer loyalty. However, the positive relation with promotion goal and customer loyalty is much stronger. The promotion focus goal gives the influence to the customer loyalty. On the contrary, the prevention focus goal relates at the low level of relation with customer loyalty than that of the promotion goal. It could be explained that it is apt to get framed the compliment of people into 'gain-non gain' situation. As the result, for those who have the promotion focus are motivated to deliver their own feeling to other people eagerly. Conversely the prevention focused individual are more sensitive to the 'loss-non loss' situation. The research result is consistent with pre-existent researches. There is a conceptual parallel between necessities-needs-utilitarian benefits and luxuries-wants-hedonic benefits (Chernev 2004; Chitturi, Raghunathan and Majaha 2007; Higginns 1997; Kivetz and Simonson 2002b). In addition, Maslow's hierarchy of needs and the precedence principle contends luxuries-wants-hedonic benefits higher than necessities-needs-utilitarian benefits. Chitturi, Raghunathan and Majaha (2007) show that consumers are focused more on the utilitarian benefits than on the hedonic benefits of a product until their minimum expectation of fulfilling prevention goals are met. Furthermore, a utilitarian benefit is a promise of a certain level of functionality by the manufacturer or the retailer. When the promise is not fulfilled, customers blame the retailer and/or the manufacturer. When negative feelings are attributable to an entity, customers feel angry. However in the case of hedonic benefit, the customer, not the manufacturer, determines at the time of purchase whether the product is stylish and attractive. Under such circumstances, customers are more likely to blame themselves than the manufacturer if their friends do not find the product stylish and attractive. Therefore, not meeting minimum utilitarian expectations of functionality generates a much more intense negative feelings, such as anger than a less intense feeling such as disappointment or dissatisfactions. The additional multi group analysis of this research shows the same result. Those who are unsatisfactory customers who have the prevention focused goal shows higher relation with WOM, comparing with satisfactory customers. The research findings in this article could have significant implication for the personal selling fields to increase the effectiveness and the efficiency of the sales such that they can develop the sales presentation strategy for the customers. For those who are the hedonic customers may be apt to show more interest to the promotion goal. Therefore it may work to strengthen the design, style or new technology of the products to the hedonic customers. On the contrary for the utilitarian customers, it may work to strengthen the price competitiveness. On the basis of the result from our studies, we demonstrated a correspondence among hedonic versus utilitarian and promotion versus prevention goal, WOM. Similarly, we also found evidence of the moderator effects of satisfaction after use, between the prevention goal and WOM. Even though the prevention goal has the low level of relation to WOM, those who are not satisfied show higher relation to WOM. The relation between the prevention goal and WOM is significantly different according to the satisfaction versus unsatisfaction. In addition, improving the promotion emotions of cheerfulness and excitement and the prevention emotion of confidence and security will further improve customer loyalty. A related potential further research could be to examine whether hedonic versus utilitarian, promotion versus prevention goals improve customer loyalty for services as well. Under the budget and time constraints, designers and managers are often compelling to choose among various attributes. If there is no budget or time constraints, perhaps the best solution is to maximize both hedonic and utilitarian dimension of benefits. However, they have to make trad-off process between various attributes. For the designers and managers have to keep in mind that without hedonic benefit satisfaction of the product it may hard to lead the customers to the customer loyalty.

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    A Study on Interactions of Competitive Promotions Between the New and Used Cars (신차와 중고차간 프로모션의 상호작용에 대한 연구)

    • Chang, Kwangpil
      • Asia Marketing Journal
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      • v.14 no.1
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      • pp.83-98
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      • 2012
    • In a market where new and used cars are competing with each other, we would run the risk of obtaining biased estimates of cross elasticity between them if we focus on only new cars or on only used cars. Unfortunately, most of previous studies on the automobile industry have focused on only new car models without taking into account the effect of used cars' pricing policy on new cars' market shares and vice versa, resulting in inadequate prediction of reactive pricing in response to competitors' rebate or price discount. However, there are some exceptions. Purohit (1992) and Sullivan (1990) looked into both new and used car markets at the same time to examine the effect of new car model launching on the used car prices. But their studies have some limitations in that they employed the average used car prices reported in NADA Used Car Guide instead of actual transaction prices. Some of the conflicting results may be due to this problem in the data. Park (1998) recognized this problem and used the actual prices in his study. His work is notable in that he investigated the qualitative effect of new car model launching on the pricing policy of the used car in terms of reinforcement of brand equity. The current work also used the actual price like Park (1998) but the quantitative aspect of competitive price promotion between new and used cars of the same model was explored. In this study, I develop a model that assumes that the cross elasticity between new and used cars of the same model is higher than those amongst new cars and used cars of the different model. Specifically, I apply the nested logit model that assumes the car model choice at the first stage and the choice between new and used cars at the second stage. This proposed model is compared to the IIA (Independence of Irrelevant Alternatives) model that assumes that there is no decision hierarchy but that new and used cars of the different model are all substitutable at the first stage. The data for this study are drawn from Power Information Network (PIN), an affiliate of J.D. Power and Associates. PIN collects sales transaction data from a sample of dealerships in the major metropolitan areas in the U.S. These are retail transactions, i.e., sales or leases to final consumers, excluding fleet sales and including both new car and used car sales. Each observation in the PIN database contains the transaction date, the manufacturer, model year, make, model, trim and other car information, the transaction price, consumer rebates, the interest rate, term, amount financed (when the vehicle is financed or leased), etc. I used data for the compact cars sold during the period January 2009- June 2009. The new and used cars of the top nine selling models are included in the study: Mazda 3, Honda Civic, Chevrolet Cobalt, Toyota Corolla, Hyundai Elantra, Ford Focus, Volkswagen Jetta, Nissan Sentra, and Kia Spectra. These models in the study accounted for 87% of category unit sales. Empirical application of the nested logit model showed that the proposed model outperformed the IIA (Independence of Irrelevant Alternatives) model in both calibration and holdout samples. The other comparison model that assumes choice between new and used cars at the first stage and car model choice at the second stage turned out to be mis-specfied since the dissimilarity parameter (i.e., inclusive or categroy value parameter) was estimated to be greater than 1. Post hoc analysis based on estimated parameters was conducted employing the modified Lanczo's iterative method. This method is intuitively appealing. For example, suppose a new car offers a certain amount of rebate and gains market share at first. In response to this rebate, a used car of the same model keeps decreasing price until it regains the lost market share to maintain the status quo. The new car settle down to a lowered market share due to the used car's reaction. The method enables us to find the amount of price discount to main the status quo and equilibrium market shares of the new and used cars. In the first simulation, I used Jetta as a focal brand to see how its new and used cars set prices, rebates or APR interactively assuming that reactive cars respond to price promotion to maintain the status quo. The simulation results showed that the IIA model underestimates cross elasticities, resulting in suggesting less aggressive used car price discount in response to new cars' rebate than the proposed nested logit model. In the second simulation, I used Elantra to reconfirm the result for Jetta and came to the same conclusion. In the third simulation, I had Corolla offer $1,000 rebate to see what could be the best response for Elantra's new and used cars. Interestingly, Elantra's used car could maintain the status quo by offering lower price discount ($160) than the new car ($205). In the future research, we might want to explore the plausibility of the alternative nested logit model. For example, the NUB model that assumes choice between new and used cars at the first stage and brand choice at the second stage could be a possibility even though it was rejected in the current study because of mis-specification (A dissimilarity parameter turned out to be higher than 1). The NUB model may have been rejected due to true mis-specification or data structure transmitted from a typical car dealership. In a typical car dealership, both new and used cars of the same model are displayed. Because of this fact, the BNU model that assumes brand choice at the first stage and choice between new and used cars at the second stage may have been favored in the current study since customers first choose a dealership (brand) then choose between new and used cars given this market environment. However, suppose there are dealerships that carry both new and used cars of various models, then the NUB model might fit the data as well as the BNU model. Which model is a better description of the data is an empirical question. In addition, it would be interesting to test a probabilistic mixture model of the BNU and NUB on a new data set.

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