Browsing by Author "Voorhees, Clay"
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Item Breakeven Time on New Product Launches: An Investigation of the Drivers and Impact on Firm Performance(Project Development & Management Association, 2014) Calantone, Roger; Randhawa, Praneet; Voorhees, ClayThe ability to break even faster on new product projects is becoming increasingly critical for firms in fast-moving industries where continually reinvesting in research and development efforts matters greatly for survival. However, most research to date has focused on studying the impact of two primary innovation outcomes: sales and profits. The exclusive emphasis on sales and profit may be warranted for certain types of goods such as durable goods, but when examining the effects of new products in fast-moving consumer goods or in the entrepreneurial sphere, where cash to cash matters greatly for survival, it is critical for both researchers and practitioners to not only consider the profits and sales generated by the new product but also the time to breakeven. This paper develops a theoretical framework using the competency-based literature to examine the effects of innovation drivers (customer idea source, speed to market, product quality, and product newness) on breakeven time (BET) and project profits, and their subsequent impact on firm performance. A three-stage least square estimation method was employed using longitudinal data on 945 new product development projects and launches in the morning (breakfast) foods category. The results clearly pinpoint that for successful product innovation, managers need to consider the time taken to breakeven on new product development. Specifically, the results demonstrate that speed to market and product quality shorten BET, but customer idea source extends BET. Second, the analysis also empirically demonstrates that BET is an equally effective predictor of firm performance as project profits in the short run, but significantly a stronger predictor of firm performance in the long run (t + four years), suggesting that BET should be regarded as a superior leading indicator of firm performance versus product profitability for fast-moving consumer goods segment. This is an important finding that suggests firms that recoup their cash investments more quickly experience greater short-term and significantly more long-term success.Item Fool's Gold? Assessing the Impact of the Value of Airline Loyalty Programs on Brand Equity Perceptions and Share of Wallet(Sage, 2015) Voorhees, Clay; White, Ryan C; McCall, Michael; Randhawa, PraneetDespite substantial investments in loyalty programs, hospitality industry managers and marketers are given little evidence regarding the loyalty programs’ overall effectiveness in driving consumer spending. This study of an airline’s loyalty program demonstrates the importance of brand power and the influence of customer characteristics on the value the loyalty program has on share of wallet. While loyalty programs in their current form do provide some brand building benefits, their effect on share of wallet is significantly stronger for price-seeking customers who are prone to brand switching. In contrast, the loyalty program has no direct effect on share of wallet for brand-loyal customers. The study also demonstrates the power of high-equity brands, which enjoy differentially higher gains from their loyalty programs than low-equity brands can experience. Thus, this airline’s loyalty program does provide some benefit, but perhaps not in the way the company wishes. The industry should consider their customers’ permanent characteristics (i.e., their level of loyalty or willingness to switch brands) and revise these programs to ensure that they continue to deliver value to a firm’s best customers rather than just attracting brand switching customers.Item Hospitality Service Innovations in Private Clubs(Sage, 2015) Randhawa, Praneet; Kim, MiRan; Voorhees, Clay; Cichy, Ronald; Koenigsfeld, Jason P; Perdue, JoeService innovation positions an organization to create and deliver anticipatory service that exceeds member expectations and ultimately strengthens relationships. However, service innovation remains one of the most under-researched topics in hospitality. This study begins to fill that gap by exploring the strategies and factors that drive service innovation in the private club industry. Drawing insights from approximately 700 critical incidents reported by private club general managers/chief operating officers, we examined the common strategies and factors that assist clubs in developing and launching new services and products. Moreover, we also categorize pressing issues in the industry that are ripe for future innovation. The findings may have implications not only for the club industry but also for the hospitality industry in general.Item The pursuit of counterfeited luxury: An examination of the negative side effects of close consumer–brand connections(Elsevier, 2015) Randhawa, Praneet; Calantone, Roger; Voorhees, ClayOver the past two decades, the counterfeiting industry has cost U.S. manufacturers over $200 billion. In this study, we extend current research on consumers' willingness to purchase counterfeit products by demonstrating that consumers' need to build their self-concept via selfbrand connection directly impact consumers' willingness to purchase counterfeits and these effects are moderated by value consciousness and openness to experience. As a result, our findings move beyond simple assessments of the impact of demographics and social norms to provide a deeper understanding of why and when consumers purchase counterfeit goods. The findings provide new insights that luxury brand managers could leverage to proactively combat counterfeiting and begin curtailing their losses due to the sale of fake goods.