Each Sunday, the Boston Globe's Uncommon Knowledge section features interesting research findings from the social sciences. Yesterday, the newspaper described a study by Crystal L. Hoyt, Jeni L. Burnette and Audrey N. Innella. The researchers examined the impact of individual beliefs regarding leadership on actual behavior. They compared people who tend to believe leaders are "born" with those who tend to believe leaders are "made." The scholars conducted two studies. In the first study, they primed individuals to think about a leadership role model. Then, they found that the people who believed that leaders are made tended to show more confidence and less anxiety as they performed a leadership task (delivering a speech). In the second study, they asked some individuals to read an article arguing that leaders are made. They found that those who read the article tended to show more confidence, exhibit less anxiety, and perform better in the delivery of a speech (as measured by independent judges).
Monday, December 19, 2011
Knowing Your Customer - By Channel!
Posted on 5:29 AM by Unknown
Knowledge @ Wharton has published an article about a new report produced by Wharton’s Jay H. Baker Retailing Center and The Verde Group, a market research firm. The report emphasizes that companies need to think carefully about the multi-channel shopper. Retailers clearly have been spending time (appropriately) trying to provide some commonality for the customer regardless of how they shop (online, in store, catalog, etc.). However, the report reminds retailers that the shopper in each channel has different wants and needs. Therefore, one has to tailor the experience to suit that customer at that point in time. The same individual may actually want a different experience in store vs. online - and some of those differences may be quite subtle, yet critical. Here is a key excerpt from the article:
"Courtney (Paula Courtney, president of The Verde Group) notes that while the emphasis for many retail businesses has been on creating a seamless experience across multiple channels, the reality is that retailers need to spend more time addressing the specific needs of various channel users. “While it’s important to have consistent policies across channels, policies are different from experiences. This [research] suggests that an overriding emphasis on ‘consistent’ channel experiences is misplaced. Different channels attract different types of customers who demand experiences that are specific to their needs and preferences.”
"Courtney (Paula Courtney, president of The Verde Group) notes that while the emphasis for many retail businesses has been on creating a seamless experience across multiple channels, the reality is that retailers need to spend more time addressing the specific needs of various channel users. “While it’s important to have consistent policies across channels, policies are different from experiences. This [research] suggests that an overriding emphasis on ‘consistent’ channel experiences is misplaced. Different channels attract different types of customers who demand experiences that are specific to their needs and preferences.”
Friday, December 16, 2011
Lego Tries to Appeal to Girls
Posted on 7:24 AM by Unknown
Business Week has a story this week about how Lego is trying to appeal more effectively to girls. I don't know if it will work, given the firm's historical image and positioning. However, I am very impressed with the research methodology that they employed before designing a new line of products specifically targeted at girls. Lego invested significant resources in anthropological research, sending researchers into homes to watch how girls play. They learned a great deal about how girls build, value beauty and color, and engage in role play. Here is one fascinating excerpt: Lego confirmed that girls favor role-play, but they also love to build—just not the same way as boys. Whereas boys tend to be “linear”—building rapidly, even against the clock, to finish a kit so it looks just like what’s on the box—girls prefer “stops along the way,” and to begin storytelling and rearranging. Lego has bagged the pieces in Lego Friends boxes so that girls can begin playing various scenarios without finishing the whole model. Lego Friends also introduces six new Lego colors—including Easter-egg-like shades of azure and lavender. (Bright pink was already in the Lego palette.)
Thursday, December 15, 2011
Hasbro Faces Challenging Times in Board Game Business
Posted on 7:02 AM by Unknown
The Wall Street Journal reports that Hasbro continues to face challenges in its board game business. Naturally, mobile and social gaming, as well as other forms of entertainment, have threatened the board game industry for some time. However, the Wall Street Journal reports that, "Sales of Hasbro's games and puzzles dropped 9% over the last three quarters, far more than overall sales of board games, which declined 3% in the same period, according to researcher NPD Group. Hasbro's game sales slid 3% last year, even as industry-wide game sales edged up 1%." Some observers claim that Hasbro has neglected its board game business as it has tried to become a broader entertainment company. The company, naturally, rejects such criticisms.
I decided to take a quick look on the Amazon site. What the are the most popular board games on Amazon right now? The top three games are produced by GameWright, MindWare, and PlaSmart. Each firm appears to be independent (i.e. not owned by a major toy company). I found this fact quite interesting. It appears, then, that the board game business may not have substantial barriers to entry, nor economies of scale that provide incumbent players such as Hasbro a formidable advantage. In fact, these independent firms often use a form of crowdsourcing to generate new games. That is, in addition to creating games in-house, they solicit game ideas from inventors around the world, and then select the best ideas. They often build on and expand those ideas to create their games.
Interestingly, the Wall Street Journal suggests that Hasbro has spent a considerable amount of time trying to modernize its classic board games, rather than emphasizing the development of many new titles. These independent firms, of course, focus on bringing totally new ideas to market. Some of Hasbro's modernization attempts have not gone so well, and in fact, have invited some humorous response. Check out Stephen Colbert's take on a new version of Monopoly that Hasbro introduced recently (start watching at the 5 minute mark):
I decided to take a quick look on the Amazon site. What the are the most popular board games on Amazon right now? The top three games are produced by GameWright, MindWare, and PlaSmart. Each firm appears to be independent (i.e. not owned by a major toy company). I found this fact quite interesting. It appears, then, that the board game business may not have substantial barriers to entry, nor economies of scale that provide incumbent players such as Hasbro a formidable advantage. In fact, these independent firms often use a form of crowdsourcing to generate new games. That is, in addition to creating games in-house, they solicit game ideas from inventors around the world, and then select the best ideas. They often build on and expand those ideas to create their games.
Interestingly, the Wall Street Journal suggests that Hasbro has spent a considerable amount of time trying to modernize its classic board games, rather than emphasizing the development of many new titles. These independent firms, of course, focus on bringing totally new ideas to market. Some of Hasbro's modernization attempts have not gone so well, and in fact, have invited some humorous response. Check out Stephen Colbert's take on a new version of Monopoly that Hasbro introduced recently (start watching at the 5 minute mark):
| The Colbert Report | Mon - Thurs 11:30pm / 10:30c | |||
| ThreatDown - Fake States, Sharia Weather & Monopoly | ||||
| www.colbertnation.com | ||||
| ||||
Wednesday, December 14, 2011
Starbucks appoints 29 year old board member
Posted on 4:19 PM by Unknown
Starbucks has announced that Clara Shih, the twenty-nine year old founder of Hearsay Social,has been appointed to the coffee company's board of directors. Shih's firm, Hearsay Social, provides tools for large companies to manage social media across many local branches and units. I find this appointment very refreshing. Company leaders often fall out of touch with key social and technological trends. Connecting regularly with young people insures that board members and executives will stay attuned to key generational differences and consumer trends. The key to making this move a success, though, will be working diligently to encourage other board members to consider her views seriously.
Tuesday, December 13, 2011
Amazon's Public Relations Problem
Posted on 8:37 AM by Unknown
Amazon caused quite a stir this week with a new promotion. They introduced a new "Price Check" smartphone app for consumers. Individuals could visit a brick and mortar store, check the item's price on Amazon, and then receive a 5% discount (maximum $5 savings) if they purchase that particular item from Amazon. Now, smartphone apps that enable consumers to check prices elsewhere have existed for quite some time. Yet, this promotion by Amazon went one step further. It not only enabled price checking, but actually gave a discount to the consumer if they chose Amazon over the brick-and-mortar retailer in which they were shopping at the moment. That extra step caused a backlash. Small business owners and advocacy groups expressed outrage at the promotion almost immediately. Politicians became upset as well. Maine Senator Olympia Snowe issued a press release in response to the promotion:
"Amazon's promotion - paying consumers to visit small businesses and leave empty-handed - is an attack on Main Street businesses that employ workers in our communities. Small businesses are fighting everyday to compete with giant retailers, such as Amazon, and incentivizing consumers to spy on local shops is a bridge too far... We should remember that our local restaurants, bookshops, and hardware stores are the economic engines in our communities. I urge Amazon to cancel its planned promotion, and look for ways to partner with Main Street, not promote anti-competitive behavior that could shutter the doors of America's small businesses."
What do we make of this situation? At the end of the day, price checking via smartphones will not be stopped. It has already begun to transform the way people shop, particularly for pricey electronics. The prevalence of such price checking will only increase in the future. Small businesses will not be able to put an end to that phenomenon. On the other hand, Amazon may have underestimated the extent to which the discount would create a public relations mess. While the firm states that they were focused mainly on competing with large retail chains, they ended up becoming portrayed as the enemy of small business. I'm sure that they don't want to be seen in this fashion. Moreover, the timing doesn't serve them well at all, given that they already face a growing controversy over the sales tax issue. Given the anti-big business mood of many people at the moment, I'm surprised that Amazon didn't think through the way that this move might feed that sentiment. Every large firm needs to consider how they might get caught up in that national mood these days.
In the video below, we hear the other side of the story. Evan Newmark, a Wall Street Journal writer and former Goldman Sachs executive, defends Amazon and criticizes Senator Snowe.
"Amazon's promotion - paying consumers to visit small businesses and leave empty-handed - is an attack on Main Street businesses that employ workers in our communities. Small businesses are fighting everyday to compete with giant retailers, such as Amazon, and incentivizing consumers to spy on local shops is a bridge too far... We should remember that our local restaurants, bookshops, and hardware stores are the economic engines in our communities. I urge Amazon to cancel its planned promotion, and look for ways to partner with Main Street, not promote anti-competitive behavior that could shutter the doors of America's small businesses."
What do we make of this situation? At the end of the day, price checking via smartphones will not be stopped. It has already begun to transform the way people shop, particularly for pricey electronics. The prevalence of such price checking will only increase in the future. Small businesses will not be able to put an end to that phenomenon. On the other hand, Amazon may have underestimated the extent to which the discount would create a public relations mess. While the firm states that they were focused mainly on competing with large retail chains, they ended up becoming portrayed as the enemy of small business. I'm sure that they don't want to be seen in this fashion. Moreover, the timing doesn't serve them well at all, given that they already face a growing controversy over the sales tax issue. Given the anti-big business mood of many people at the moment, I'm surprised that Amazon didn't think through the way that this move might feed that sentiment. Every large firm needs to consider how they might get caught up in that national mood these days.
In the video below, we hear the other side of the story. Evan Newmark, a Wall Street Journal writer and former Goldman Sachs executive, defends Amazon and criticizes Senator Snowe.
Friday, December 9, 2011
How Early Career Experiences Shape Future Career Prospects and Decision-Making
Posted on 5:06 AM by Unknown
Antoinette Schoar and Luo Zuo have published a new paper titled, "Shaped by Booms and Busts: How the Economy Impacts CEO Careers and Management Style." They studied how early career experiences shape future career prospects and decision-making. Here is what they found:
"Economic conditions at the beginning of a manager’s career have lasting effects on the career path and the ultimate outcome as a CEO. CEOs who start in recessions take less time to become CEOs, but end up as CEOs in smaller firms, receive lower compensation, and are more likely to rise through the ranks within a given firm rather than moving across firms and industries. Moreover, managers who start in recessions have more conservative management styles once they become CEOs."
I found the last point particularly interesting, namely that a person tends to become a bit more risk averse after experiencing a major recession early in his or her career. Now that could be a good thing. Perhaps we will see less "irrational exuberance" in future years from those currently starting out their careers.
"Economic conditions at the beginning of a manager’s career have lasting effects on the career path and the ultimate outcome as a CEO. CEOs who start in recessions take less time to become CEOs, but end up as CEOs in smaller firms, receive lower compensation, and are more likely to rise through the ranks within a given firm rather than moving across firms and industries. Moreover, managers who start in recessions have more conservative management styles once they become CEOs."
I found the last point particularly interesting, namely that a person tends to become a bit more risk averse after experiencing a major recession early in his or her career. Now that could be a good thing. Perhaps we will see less "irrational exuberance" in future years from those currently starting out their careers.
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