Knowledge that Transforms

AbstractDespite offering substantial opportunities to tailor services to consumers’ wants and needs, artificial intelligence (AI) technologies often come with ethical and operational challenges. One salient instance of such challenges emerges when vulnerable consumers, consumers who temporarily or permanently lack resource access or control, are unknowingly discriminated against, or excluded from the marketplace. By integrating the literature on consumer vulnerability, AI for social good, and the calls for rethinking marketing for a better world, the current work builds a framework on how to leverage AI technologies to detect, better serve, and empower vulnerable consumers. Specifically, our AID framework advocates for designing AI technologies that make services more accessible, optimize customer experiences and journeys interactively, and to dynamically improve consumer decision-making. Adopting a multi-stakeholder perspective, we also discuss the respective implications for researchers, managers, consumers, and public policy makers.

AbstractDespite heightened interest in brand transgressions among academics and practitioners, the literature remains silent about the influence of a brand’s origin on consumer responses to brand misconduct. This leaves managers unaware of how to adapt post-transgression recovery strategies at home and abroad. Contrary to the in-group country bias literature, we theorize an “origin-backfire” effect: consumers forgive domestic brand transgressions less. Analyzing experimental, social media, and secondary-longitudinal data, we find that consumers treat domestic brand transgressors as home-country traitors deserving punishment. Social identity threats mediate this effect and consumer ethnocentrism attenuates it. Transgressions’ damage on brand reputation and value is larger and takes longer to recover from in domestic markets. Managers can alleviate post-transgression backlash through communication framing that construes the transgression as a response to intergroup threats (in foreign markets) and through collective compensation strategies (in domestic markets). The findings reveal cross-national variability in transgressions’ experience, impact, and recovery and inform post-transgression repair strategies.

AbstractHome sharing platforms have experienced a rapid growth over the last decade. Following negative publicity, many cities have started regulating the short-term rental market. Regulations often involve a cap on the number of days a property can be rented out on a short-term basis. We draw on rich data for short-term rentals on Airbnb and for the long-term rental market to examine the impact of short-term rental regulations with a day cap on various stakeholders: hosts, guests, the platform provider, and residents. Based on a difference-in-differences design, we document a sizable drop in Airbnb activity. Interestingly, not only targeted hosts (i.e., hosts with reservation days larger than the day cap), but also non-targeted hosts reduce their Airbnb activity. The reservation days of non-targeted hosts decrease between 26.27% and 51.89% depending on the treatment. Targeted hosts experience a similar decline. There is, nevertheless, significant non-compliance: more than one third of hosts do not comply with enacted short-term rental regulations. Additional analyses show that few properties are redirected from short-term rental to long-term rental use and that there is no significant drop in long-term rents. Drawing on a theoretical model, we tie the estimated effects to changes in stakeholders’ welfare: Regulations significantly reduce the welfare of hosts, and the loss ranges between 46.30% and 9.02%. The welfare loss of the platform provider is proportional to the loss of the hosts. Welfare of guests decreases moderately ranging between 4.5% to 4.1%. The welfare of residents increases minimal. These results question the effectiveness and desirability of the studied short-term rental regulations.

AbstractInspired by the goal of making marketplaces more inclusive, this research provides a deeper understanding of consumer vulnerability dynamics to develop strategies that help reduce these vulnerabilities. The proposed framework, first, conceptualizes vulnerability states as a function of the breadth and depth of consumers’ vulnerability; then, it sketches a set of vulnerability indicators that illustrate vulnerability breadth and depth. Second, because the breadth and depth of vulnerability vary over time, the framework goes beyond vulnerability states to identify distinct vulnerability-increasing and vulnerability-decreasing pathways, which describe how consumers move between vulnerability states. In a final step, the framework proposes that organizations can (and should) support consumers to mitigate vulnerability by helping consumers build resilience (e.g., via distinct types of resilience-fueling consumer agency). This framework offers novel conceptual insights into consumer vulnerability dynamics as well as resilience and provides avenues for future research on how organizations can better partner with consumers who experience vulnerabilities.

AbstractThe use of conversational agents (e.g., chatbots) to simplify or aid consumers’ purchase decisions is on the rise. In designing those conversational agents, a key question for companies is whether and when it is advisable to enable voice-based rather than text-based interactions. Addressing this question, this study finds that matching consumers’ communication modality with product type (speaking about hedonic products; writing about utilitarian products) shapes consumers’ choice and increases choice satisfaction. Specifically, speaking fosters a feeling-based verbalizing focus, while writing triggers a reason-based focus. When this focus matches consumers’ mindset in evaluating the product type, preference fluency increases, thereby enhancing choice satisfaction. Accordingly, the authors provide insights into managing interactions with conversational agents more effectively to aid decision-making processes and increase choice satisfaction. Finally, they show that communication modality can serve as a strategic tool for low-equity brands to better compete with high-equity brands.

AbstractJourney research has primarily analyzed agentic, solo travelers making rational single-purchase decisions. In contrast, we examine a journey where consumers and their traveling companions are vulnerable and must navigate an unfamiliar service system. We explore how vulnerability shapes consumer journeys, how service and system factors impact vulnerability, and how traveling companions influence agency and vulnerability. Using data from an extensive study into end-of-life care, our results reveal novel insights into the role of consumer vulnerability throughout a journey. We show how the ebb and flow of consumer vulnerability shapes the journey, and how the journey shapes vulnerability. Traveling companions, themselves vulnerable, play a major role in influencing vulnerability and the journey itself. We offer managerial implications for organizations whose consumers are in vulnerable situations.

AbstractRecent technological advancements allow companies to incorporate increasingly heterogeneous and interrelated features into their products, which heightens the products’ complexity. In four experimental studies conducted with two product categories, this article reveals similarities and differences in terms of how the heterogeneity and interrelatedness of product features influence consumer attitudes (i.e., expected product usability and capability) and, in turn, purchase intentions. Moreover, it shows that both neglected dimensions of product complexity affect the corresponding influence of the number of product features but do so in considerably different ways. The findings suggest that companies can foster consumer adoption by deemphasizing a product’s feature heterogeneity, thereby avoiding low expected product usability, and by emphasizing its feature interrelatedness, thereby promoting high expected product capability. This article provides insights into how companies can manage the complexity of products during both product design (i.e., before market launch) and product advertising and selling (i.e., after market launch).

AbstractFacial emojis have increasingly permeated electronic word of mouth (eWOM), but the persuasive consequences of this phenomenon remain unclear. Drawing on emotions as social information (EASI) theory, this research reveals that facial emojis influence persuasion (e.g., product choice) by affecting emotional arousal and perceived ambiguity. While the effect through emotional arousal is generally positive, the effect through ambiguity depends on the emojis’ function in eWOM: facial emojis that replace a verbal expression increase ambiguity and therefore reduce persuasion, whereas those that reiterate a verbal expression decrease ambiguity and therefore enhance persuasion. Both the emotional-arousal and ambiguity pathways determine the net persuasive effect. This research also explores two situations (high verbal context richness and eWOM from strong ties) where replacing facial emojis can increase persuasion. Finally, the authors show that facial emojis’ persuasive power is generalizable to online brand communications, influencing key management outcomes such as click-through rates for digital ads.