Current Sales Research Articles

Target ratcheting and effort reduction

In this paper, we examine how retail store managers reduce their sales activity in response to target ratcheting. We find that managers with favorable sales performance in the first three quarters reduce their sales activity in the final quarter. We also document that managers who engage in sales reducing activities enhance their likelihood of meeting their next-year sales target, which is based on their current sales. That is, managers who reduce their sales activity in the final quarter are more likely to beat their next-year sales targets than managers who refrain from reducing their final-quarter sales.

The clinical use of right-sided double-lumen tubes

Right-sided double-lumen tubes (DLTs) have a bad reputation. Many experts in the field of thoracic anesthesia regard them as being difficult to position, having a small margin of safety for correct placement, and being prone to intraoperative malpositioning. However, in a randomized prospective study, Campos et al. compared the use of right vs left DLTs in two groups of 20 patients having left thoracotomies. In this small study, there were no significant differences between the two types of DLTs with respect to the relevant aspects of clinical performance, including the time for left lung collapse and the incidence of inadvertent right upper lobe collapse. There was a tendency for rightsided tubes to become malpositioned intraoperatively, but in all cases this difficulty was corrected easily by fibreoptic bronchoscopy. In a more recent retrospective report, the anesthetic records of 961 thoracic procedures were examined at one teaching institution where the usual practice was to use a DLT contralateral to the side of surgery, i.e., a rightsided tube for left-sided surgery. There were no differences in the incidences of hypoxemia, hypercarbia, or high airway pressures between patients managed with left or right DLTs. The current sales of DLTs in North America show a 10:1 preference for leftvs right-sided tubes (personal communication with Covidien, Mansfield, MA, USA), suggesting that the majority of anesthesiologists tend to use left DLTs whenever possible. Given the evidence that right DLTs may function as well as left DLTs, and in view of the fact that it is necessary to use a right DLT in certain select cases, perhaps it is time to reconsider their use for routine airway management in thoracic surgery. To appreciate our current clinical practice in thoracic anesthesia, it is useful to understand how we arrived at where we are today. Both the spectrum of patients and the equipment available for lung isolation have changed drastically from the origins of lung isolation in the 1930s. At that time, thoracic surgery was essentially for complications of infectious diseases, e.g., abscesses, bronchiectasis, hemoptysis, etc., which were often due to tuberculosis. The anesthesiologist’s major priority was to protect the dependent lung from contamination with the infected secretions from the operative lung. The initial methods of lung isolation involved placement of a modified endotracheal tube as a single-lumen endobronchial tube in the mainstem bronchus of the non-operative lung. These tubes were placed by a rigid bronchoscope through the singlelumen tube and rigid bronchoscopy was a standard skill of the pioneers of thoracic anesthesia. Selective intubation of the contralateral lung became an established principle. In 1949, Carlens, a respirologist, introduced a red rubber leftsided DLT designed to be placed with topical anesthesia in awake patients with tuberculosis who were having splitlung broncho-spirometry as a part of their workup for possible lung resection. This DLT was quickly adopted by the thoracic surgeon, Bjork, who published a report with Carlens regarding the DLT’s use in 500 pulmonary resections in 1952. This landmark DLT had a carinal hook so it could be positioned solely with laryngoscopy and auscultation, eliminating the need for rigid bronchoscopy. It allowed simultaneous ventilation of the dependent lung and suctioning of the non-dependent lung, and it became the preferred device for lung isolation in the 1950’s in preference to single-lumen tubes and bronchial blockers. Thus began the clinical preference for left DLTs. A right-sided version P. Slinger, MD (&) Department of Anesthesia, Toronto General Hospital, University of Toronto, Eaton North Wing, 3rd Floor, Room 441, 200 Elizabeth Street, Toronto, Ontario M5G 2C4, Canada e-mail: peter.slinger@uhn.on.ca

The sales function in the twenty‐first century: where are we and where do we go from here?

PurposeThis article aims to position current sales research in relation to what academics perceive as important future research areas for sales theory and practice. It makes the argument that after a 20‐year period of rapid growth and almost a decade of a transition phase, sales research is now a mature area of academic inquiry. The paper seeks to highlights gaps in current knowledge and promising avenues for future sales research endeavours.Design/methodology/approachThe article is based on a survey of European sales academics; answers are mapped in matrices demonstrating fields of importance against research volume per subject over the past 20 years.FindingsWhile sales research has made many theoretical and managerial inroads, there are still areas where research efforts would greatly enhance both practitioner and academic knowledge.Research limitations/implicationsResearchers should focus their efforts on the highlighted areas, taking particular account of the interplay between sales and finance/accounting. This would allow researchers to address such issues as budgeting and forecasting more systematically than had been done heretofore.Originality/valueThe article combines perceptual data with Williams and Plouffe's meta‐analysis of published sales research to deliver a comprehensive and actionable picture of the state of sales research.

Anchoring Effects: Evidence from Art Auctions

This paper shows that the price of a painting sold at an art auction and the experts' pre-sale valuations are anchored on the price at which the painting previously sold at auction. We are able to separate anchoring from rational learning by using the identifying strategy that the unobservable component of quality for a particular painting remains constant between the last auction sale and the current auction sale. We interpret these results as anchoring on the part of the buyers, with the sellers and auctioneers either anticipating anchoring on the part of the buyers or exhibiting anchoring effects themselves. (JEL D44, Z11)

Minimally invasive surgery in urogynecology

Minimally invasive surgery has been a term used to describe laparoscopic surgery and more recently the trocar-guided synthetic mid-urethral slings for stress incontinence and the trocar-guided synthetic mesh kits to treat prolapse. This term implies a lesser operation, more pain free and safer, which in many cases is not true. This description seems more to do with marketing the product and the surgeon than actually describing the benefits and risks of the procedure. When complications occur as they always will, they may be more unexpected by the patient and poorly tolerated. Therefore informed consent, giving the patient a clear understating of the procedure, possible risks and benefits, and likely outcome, is essential. Synthetic polypropylene slings (SPS) are not new and were used to treat women with stress incontinence by Morgan in Northern America and Moir in the UK in the 1960s. These slings were placed under the bladder neck through open abdominal and vaginal incisions. However, it was not until the mid-1990s with the introduction of the tension-free vaginal tape (TVT) that SPS gained widespread usage when placed through small incisions using trocar needles at the mid-urethral position. These retropubic slings have been found to have benefits of shorter hospitalization, less postoperative pain and a lower morbidity than the Burch colposuspension and fascial slings but equal effectiveness. Over the last 6 years, numerous variations of the TVT have been introduced, including the transobturator approach and the no-incision mini-slings (TVT Secur, Gynecare Ethicon Inc., Somerville, NJ) and Miniarc (American Medical Systems Inc., Minnetonka, MN). A major advantage of the transobturator and minislings is the avoidance of the retropubic space, decreasing complications such as bladder and bowel perforation, and major vascular injury. Bladder perforation in retropubic slings is a common complication with reported rates of 0.7% to 34.2% compared to 0% to 3.1% in the transobturator approach [1]; if recognized, sling replacement is performed without clinical sequel. Bowel and vascular injuries are more serious and have resulted in patient deaths. These complications have resulted in many surgeons changing from retropubic slings or preferring to learn the other approaches. Current sales of these stress incontinence devices according to industry sources are “obturator slings make up just over half of the total synthetic sling procedures performed in the US. Newer single incision slings represent between 15%–20%. The remaining 30% are retropubic slings. This is across all major/medium size brands.” However, is this change away from retropubic slings for perceived safety reasons premature and in the patient’s best long-term interests? Prospective randomized studies [1] comparing the retropubic and transobturator slings in woman with non-intrinsic sphincter deficiency (non-ISD) stress urinary incontinence (SUI) have shown no significant difference in effectiveness, although follow-up in these studies is of short duration (less than a year) and based on symptoms only. However, short-term subjective outcomes may not be indicative of more long-term results. In a study comparing pubovaginal sling to transurethral Macroplastique injection in ISD patients [2] the subjective symptomatic improvement was not significantly different at 6 months, but urodynamic SUI cure at 6 months, (81% vs. 9%) and 5 year symptomatic cure was significantly in favor of the pubovaginal fascial sling (69% vs. 21%). In women with ISD, SUI the retropubic TVT sling has been shown to be more Int Urogynecol J (2009) 20:485–486 DOI 10.1007/s00192-009-0854-5

Exchange Rates and Concurrent Leasing and Selling in Durable-Goods Monopoly

Theoretical durable-goods models suggest that a monopolist will prefer to lease rather than sell units of output due to the seller’s commitment problem with potential buyers. However, many monopolistic durable-goods manufactures are commonly observed simultaneously leasing and selling output. We provide a theoretical rationale for this observed behavior in firms engaged in trade with a foreign country. In a simple two-period setting we show that a foreign durable-goods monopolist will concurrently lease and sell output if the expected future exchange rate is lower than the current rate. With this concurrent strategy the firm earns higher profit than a pure rental or sales regime. Additionally, our model provides additional theoretical underpinnings for the empirical finding that increases in expected future exchange rates increase the current sales price of durable products. Finally, our analysis examines the role of product durability in determining exchange rate pass-though to domestic prices.

Deferred Revenues and the Matching of Revenues and Expenses

An increase in the complexity of firms’ contracts with customers, combined with changes in reporting regulations, has resulted in a substantial increase in revenue deferrals in recent years. Between 2002 and 2009, each year nearly forty percent of industrial firms on COMPUSTAT reported a deferred revenue liability, with the liability averaging at least ten percent of sales revenue. This study examines the implications of revenue deferrals for firms’ financial statements, equity values, and for analysts’ forecasts of sales and earnings. When revenues are deferred but some of the associated expenses are recognized as incurred, revenue deferrals depress current margins and improve margins in the period in which revenue is recognized. Analysis in this paper shows that the deferral of revenues without the capitalization of associated costs adversely affects earnings predictability, which, in turn, results in significant errors in analyst forecasts of both sales and margins and in mispriced securities. The results show that market participants use current sales and margins to predict future earnings without making adequate adjustments for the fact that revenue deferrals depress current sales and margins and inflate future sales and margins. Therefore, when revenue deferrals increase, analysts underestimate future earnings and investors undervalue the firm. Conversely, when revenue deferrals decrease, analysts overestimate future earnings and investors overvalue the firm.

Customer Equity Drivers and Future Sales

Research on linking operational marketing inputs to customer attitudes and customer behavior has been gaining significance concomitant with the growing recognition that customers are market-based assets. In response to this, researchers and practitioners have proposed several conceptual models. Despite recent advances in research, the results are still inconclusive as to the relationship between customer attitude and future sales. A reason for this could be due to the paucity of studies combining survey-based data with behavioral data to understand better the drivers of customer behavior. With that in mind, the authors investigate the effects of customer perceptions of key marketing actions on customer attitudes and actual customer behavior as reflected by future sales. The authors propose that customer perceptions of value, brand, and relationship—“customer equity drivers”—affect loyalty intentions and future sales. The results of the study, which is based on a sample of 5694 customers of a large European do-it-yourself retailer, suggest that customer equity drivers can significantly predict future sales, even after the authors control for the current sales level.

Customer Equity Drivers and Future Sales

Research on linking operational marketing inputs to customer attitudes and customer behavior has been gaining significance concomitant with the growing recognition that customers are market-based assets. In response to this, researchers and practitioners have proposed several conceptual models. Despite recent advances in research, the results are still inconclusive as to the relationship between customer attitude and future sales. A reason for this could be due to the paucity of studies combining survey-based data with behavioral data to understand better the drivers of customer behavior. With that in mind, the authors investigate the effects of customer perceptions of key marketing actions on customer attitudes and actual customer behavior as reflected by future sales. The authors propose that customer perceptions of value, brand, and relationship—“customer equity drivers”—affect loyalty intentions and future sales. The results of the study, which is based on a sample of 5694 customers of a large European do-it-yourself retailer, suggest that customer equity drivers can significantly predict future sales, even after the authors control for the current sales level.

Advertising Strategies in a Differential Game with Negative Competitor’s Interference

We consider a duopolistic industry where the current sales of each firm is proportional to its goodwill stock. The evolution of the latter depends positively on own advertising effort and negatively on competitor's advertising. A standard assumption in the literature in differential games of advertising is that the players remain active throughout the whole (infinite) duration of the game. We relax this assumption and characterize the circumstances under which a firm finds it optimal to remain or exit the industry. Among other things, it is shown that, if both players are "strong", then the unique Nash equilibrium is the same that one would obtain in the absence of interference from competitor's advertising.

Empirical Evidence on the Success of R&D Co-Operation - Happy Together?

In this paper we analyse the effect of R&D co-operation on firms' innovation performance. We investigate the effect of past co-operation on current sales of innovative products, distinguishing between products new to the firm and new to the market, and on cost reductions due to innovative processes. Particular attention is paid to the impact of different co-operation partners. The analysis rests on firm-level data from two consecutive waves of the annual German innovation survey. We find that innovative firms that cooperate have a higher share of turnover with market novelties and a higher share of cost reduction due to process innovations than non-cooperating firms. In particular, R&D cooperation with research institutes has a positive influence on a firm's economic success with market novelties, while R&D co-operation with competitors leads to an increase in the cost reduction attributable to innovative processes.

NEW TYPE OF TUNNEL TANK REPLACES DAY TANK1

Current retail distribution methods compel the glass manufacturer to be prepared for rapid changes in style, designs, and colors. Small, flexible, producing units capable of accurate control and permitting rapid color changes or composition of glass aid in maintaining a close ratio between production and current sales. Day tanks are elastic in operation, but are not as economical or reliable as continuous tanks. A day tank was replaced with a tunnel tank (two feet wide by twenty feet long) of equivalent melting capacity per shift. Details of construction, drawing, gas consumption, filling, and operation are given. Advantages gained: dependable production with uniform color, melting conditions stabilized and assurred, producing capacity increased threefold without increasing fuel or labor costs, repair production loss cut, repair labor and material costs reduced.

Effects of Climate Change on Alpine Skiing in Sweden

Climate change has already affected and will continue to affect physical and biological systems in many parts of the world. For example, annual snow cover extent in the northern hemisphere has decreased by about 10% since 1966, and in Sweden, the last decade was wetter and warmer than the preceding 30-year period. These changes will affect many aspects of utilisation patterns that are dependent on the physical environment, such as alpine winter tourism. In this paper, we discuss the future development of the downhill skiing industry in Sweden. We first review trends in alpine winter tourism in relation to climate change together with regional projections of climate change. Secondly, we examine trends in climate parameters relevant to alpine winter tourism in Sweden during the last 30 years. Thirdly, we take these parameters, together with regional projections of climate change, and predict effects on the number of skiing days in order to estimate the monetary loss for the skiing industry in Sweden. The analyses show predicted losses that are larger than current ski-ticket sales. Adaptation strategies such as the development of year-round tourist activities should be developed as soon as possible.

Valuing Renewable Energy in Emerging U.S. Carbon Markets

The current input-based allocation system proposed for the Regional Greenhouse Gas Initiative in the Northeast prevents renewable energy from contributing to emissions reductions within the market. A scheme where allowances are set aside for current and future voluntary green power sales and retired by customers when they are purchased would allow additional reductions to be made. Whichever allocation scheme is chosen, though, should be implemented in both emerging U.S. markets to decrease problems of allowance fungibility and reduce transaction costs associated with allowance tracking.

Promotional piracy

AbstractUnauthorized copying of goods can displace current sales. At the same time, those who pirate a product may help alert others to its existence, leading to stronger future demand. I discuss a simple model which leaves room for both effects. Piracy's net profit impact is linked to the whereabouts of people in the space of willingness‐to‐pay and personal piracy cost. Considerations of location help demystify empirical puzzles, such as why some (computer games manufacturers) deploy stringent copy protection when elsewhere (business software) controls appear more relaxed.

Current Sales Data and What the “Long Tail” Might Be Doing

Current Sales Data and What the “Long Tail” Might Be Doing

Coordinating multi-business sales through management simulators

Multi-business corporations are used to face complex decision-making problems. Among these, one of the most complex one is that of managing their Sales Force so as to balance and exploit their multi-business portfolio. The case outlined in this paper explores the cross-selling approach to sales management; this approach aims at aligning, controlling and enhancing the sales performances of a multi-business company. Such a complex environment offered an interesting playground to see whether the system dynamics methodology could help the managerial decision-making process. The paper therefore pinpoints a simulation work carried out at Siemens Turkey, which includes the analysis and simulations of the current sales structure and the re-design of the sales management policy. The developed simulation model claims to be the most detailed market growth model in Siemens. In February 2005, the model was turned into a management game, which has been played by 22 managers to enhance organisational learning. Some months later, in October 2005, it has been presented as a benchmark application at the company headquarters (Germany), to show that the company was suffering from its own order processing mechanism, which was acting as an aging-chain, and that the cross-selling policy would outperform the current method in terms of larger sales figure and less severe oscillations. The paper presents both these research and learning experiences, and discusses executive business recommendations (to reduce the delays in the order structure, to modify the salesmen bonus schemes for cross-selling and the frequency of Siemens ONE Training programme) as well as it proposes further suggestions for model development and implementation.

Increased uptake of biologics in historically small molecule blockbuster-dominated therapeutic areas

The two leading therapeutic areas for biologic products, in terms of current sales and pipeline focus, are oncology and AIID (arthritis, immune and inflammatory disorders). Datamonitor has recently analysed these markets.1, 2 Biologics designed to treat cancer indications have underpinned the development of the biotechnology market since its inception in the 1980s, while AIID biologics are currently driving biotechnology market growth, due to the high demand for biologics to treat diseases such as rheumatoid arthritis and psoriasis.In this paper, we have looked outside these markets to identify whether biologic drugs are having an impact in other therapeutic markets. Many of these therapeutic markets (eg cardiovascular, central nervous system, respiratory, gastrointestinal) are dominated by small molecule blockbusters prescribed by primary care physicians. Here, we examine the cardiovascular therapeutic franchise as a case study for a market that has relied heavily on small molecule blockbusters to drive growth, and in which there is relatively low exposure to biologics.Marketed and pipeline cardiovascular biologics can largely be split into two categories: (i) early-evolution versions of drugs from mature biologic sectors (eg first-generation recombinant proteins and chimeric monoclonal antibodies), which are in the mature low-growth stages of their sales growth trajectories; and (ii) early-stage therapies based on innovative biologic technology platforms (eg gene therapies and oligonucleotides), which have the potential to help power cardiovascular franchise growth in the future. With the identification of more protein targets that play a role in specific disease aetiology, targeted therapies are set to power overall market growth. While companies operating in the oncology and AIID franchises are best equipped to use a targeted therapy strategy, franchises such as cardiovascular are beginning to awaken to the potential of a targeted therapy approach.

Product configuration analysis with design structure matrix

PurposeProduct configurator is a sales and production‐planning tool that helps to transform customer requirements into bills‐of‐materials, lists of features and cost estimations. The purpose of this paper is to introduce a method of how to analyse sales configuration models by using a design structure matrix (DSM) tool. By applying the DSM techniques, the sales configuration managers may sequence the product configuration questions and organize the connection to production.Design/methodology/approachFirst, the paper explains a sales configuration system structure from published academic and non‐academic works. These sources employ both theoretical and practical views on the topic of computer‐based sales expert systems. Second, the paper demonstrates an application of using DSM for configuration modelling.FindingsThe current sales configuration approaches include constraint‐based, rules‐based, and object‐oriented approaches. Product description methods vary, but the general problem remains the same: the configuration process should be designed in such a way that customer selections do not affect the previous selections. From the user point of view, answering the questions should be smooth and fast. In turn this will lead to the growing importance of building more effective product configuration models. DSM offers a systematic way to organise customer interface in sales configuration systems.Research limitations/implicationsThis paper analyses how DSM could help in planning product configuration modelling. Comparison of different sequences is presented. The examples used are hypothetical, but illustrate the suitability of DSM analysis. Companies are trying to establish easily configured product models, which are fast, flexible and cost‐effective for adjustments and modifications. Use of DSM may help in the roll‐out of sales configuration projects. DSM may also be used as a quick view to represent the complexity of product configurability. The future needs for configuration tools will be focused towards product model management from the technical limitations of different data storage approaches.Practical implicationsConfigurator software creates product variants, which are logical descriptions of physical products. Variants have parameters which describe the customer‐made selections. The parameter selections may have interconnections between the choices. Some selections may affect further selections and some combinations may not be allowed for incompatibility, cost or safety reasons. There are several commercial software packages available for creating product configurations. Product description methods vary, but the general problem remains the same: the configuration process should be designed in such a way that customer selections do not affect the previous selections. Answering the questions should be smooth and fast. Configuration of complex products, for instance, airplanes, may include several sub‐systems and have various loops within the quotation process. The use of DSM may help in the roll‐out of sales configuration projects. DSM may also be used as a quick view to represent the complexity of product configurability.Originality/valueThe paper helps both researchers and practitioners to obtain a clearer view on the development of sales configuration systems and the potential of systematic DSM‐based product model analysis.

Cancer remains the dominant disease target for biotech through to 2010

The two leading therapeutic areas for biological products, in terms of current sales and pipeline focus, are oncology and AIID (arthritis, immune and inflammatory disorders). Datamonitor’s biotechnology strategic market analysis team recently analysed the AIID market, since this sector is currently powering biotechnology market growth, owing to high demand for biologicals to treat rheumatoid arthritis and psoriasis (Belsey, M. and Churchill, C. (2006) ‘Autoimmune and inflammatory disorder biologicals will power biotech market growth through to 2010’, J. Comm. Biotechnol., Vol. 12, No. 2, pp. 237‐241). In the current paper, we have analysed the oncology market, since biologicals designed to treat cancer indications have underpinned the development of the biotechnology market since its inception in the 1980s. Biological products treat a wide variety of cancers, of which the most prevalent are the ‘big four’ tumour types ‐ breast cancer, lung cancer, prostate cancer and colorectal cancer. In terms of technology focus, both monoclonal antibody therapeutics and recombinant proteins are set to drive cancer biological market growth. Key growth drivers include mainly Genentech and Roche products, such as Avastin (bevacizumab), Rituxan (rituximab) and Herceptin (trastuzumab), as well as Amgen products, including the second-generation recombinant proteins Neulasta (pegfilgrastim) and Aranesp (darbepoetin alfa). Across the major pharmaceutical markets, oncology biologicals generated US$10.7bn in 2004 (based on company-reported data), which Datamonitor forecasts to rise to US$29.0bn by 2010.