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Engaging leadership style may boost employee engagement

Supervisors perceived as engaged leaders in the initial survey did indeed enhance employee engagement as captured in the second survey. This impact appeared to occur via a boost in employees’ personal psychological resources of optimism, resiliency, self-efficacy, and flexibility—these results are in line with evidence from previous studies.

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A new analysis suggests that a particular leadership style dubbed “engaging leadership” can boost employees’ engagement and enhance team effectiveness within the workplace. Greta Mazzetti of the University of Bologna, Italy, and Wilmar Schaufeli of Utrecht University in the Netherlands present these findings in the open-access journal PLOS ONE.

An employee who is engaged typically has a positive state of mind relating to their work and shows vigor, dedication, and absorption in their work. Previous research suggests that more engaged employees tend to have greater well-being and better job performance.

Previous research also suggests that a certain style of leadership known as engaging leadership—involving leaders who fulfill employees’ need for autonomy, feeling competent, and feeling cared for—may boost employee engagement. However, most studies of workplace leadership styles have focused on a single point in time, without analyzing potential effects over time.

To provide new insights, Mazzetti and Schaufeli explored the impact of an engaged leadership style on work engagement and team effectiveness of 1,048 employees across 90 teams within a Dutch workplace. Participants each took two surveys, one year apart, which included questions about their supervisors’ level of engaging leadership, their own work engagement, and other personal and team characteristics.

Statistical analysis of the responses suggests that supervisors perceived as engaged leaders in the initial survey did indeed enhance employee engagement as captured in the second survey. This impact appeared to occur via a boost in employees’ personal psychological resources of optimism, resiliency, self-efficacy, and flexibility—these results are in line with evidence from previous studies.

Similarly, engaged leaders appeared to enhance team effectiveness by boosting team resources, which consisted of performance feedback, trust in management, communication, and participation in decision-making. Team resources also appeared to affect individual employee engagement.

These findings support the use of engaging leadership to boost employee engagement and team effectiveness in the workplace. Future research could compare the effects of engaging leadership versus other leadership styles on employees and teams over time.

The authors add: “A leader who inspires, strengthens and connects team members fosters a shared perception of available resources (in terms of performance feedback, trust in management, communication, and participation in decision-making), and a greater psychological capital (i.e., self-efficacy, optimism, resilience, and flexibility).”

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Stars outweigh numbers in online review ratings battle

Consumers perceived numerical ratings in the 3.5-3.9 range as lower than if that same rating were presented in stars due to left-digit anchoring.

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Mathematically speaking, scoring 3.5 out of 5 is the same as receiving three and a half stars on a five-star scale. But visually speaking, the numbers don’t add up.

When it comes to enticing potential consumers to either click on an ad or buy a product, formats matter. Shapes outweigh numbers in the online review ratings battle.

A new study found that consumers view a 3.5-rated product to be higher — and better — when the score is illustrated in shapes like stars, circles and bars, versus numbers.

“Simply changing a rating’s format from numbers to stars increases the perception of the rating as higher,” said Carter Morgan, an assistant professor in the School of Marketing and Innovationin the Muma College of Business, who co-authored the study.

Researchers found that consumers perceived numerical ratings in the 3.5-3.9 range as lower than if that same rating were presented in stars due to left-digit anchoring.

Left-digit bias is a psychological phenomenon where people place more emphasis on the leftmost digit. A consumer’s brain tends to process numbers digit by digit with a focus on the left most digit when interpreting numbers.

For a rating of 3.5, consumers typically focus on the digit 3 instead of the full number 3.5, therefore believing the rating to be lower than it is, Morgan said.

The study’s findings have practical implications for online retailers, marketing managers and website designers and public policy makers.

Researchers recommend using stars, circles, or bars as opposed to numbers in product ratings because shapes can boost a consumer’s likelihood of choosing a product, their intent to buy it, and even their likelihood of clicking on related advertisements.

Consumer advocates and government agencies have pushed to increase transparency for online ratings and reviews.

Public policy makers may want to consider standardizing rating formats so that customers are not unintentionally biased in their decision-making, Morgan said.

The article, “The Power of a Star Rating: Differential Effects of Customer Rating Formats on Magnitude Perceptions and Consumer Reactions,” published online for early access in the Journal of Marketing Research.

Aside from Morgan, the article’s co-authors include Annika Abell and Marisabel Romero, both from the University of Tennessee Knoxville.

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‘Free’ delivery plans profit both retailers and customers

Free-delivery subscription (FDS) plans come surprising close to being a free lunch. They can offer financial benefits to everyone involved: retailers such as Target and Amazon and their customers, who intend to buy many products and take advantage of free shipping.

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In March, Target became the latest mega-retailer to offer “free” delivery — for a price. For $99 a year, subscribers to Target Circle 360 can place unlimited orders without having to worry about shipping costs. Target competes with similar plans offered by Walmart and Amazon.

Of course, someone ultimately must pay those delivery costs. Or do they?

According to new research from Texas McCombs, free-delivery subscription (FDS) plans come surprising close to being a free lunch. They can offer financial benefits to everyone involved: retailers such as Target and Amazon and their customers, who intend to buy many products and take advantage of free shipping.

The paper was co-authored by Anant Balakrishnan, professor of information, risk, and operations management. With Shankar Sundaresan of Rutgers University and McCombs graduate Chinmoy Mohapatra — now at Amazon — he explored whether FDS services are a good business move, compared with the traditional practice of having customers pay extra for shipping.

“We saw some articles in the business press that the actual cost of delivering goods was more than twice the amount they recover from subscription fees,” Balakrishnan says. “It begs the question: How can this be sustainable?”

For example, he says, if a company spends $8 per order on shipping costs and charges $80 for its subscription, its operations costs exceed the fee after 10 orders. What’s more, customers who subscribe to FDS place smaller orders more frequently, instead of grouping items together to save on shipping. That further increases the company’s total delivery costs.

It’s hard to get cost and revenue information from mega-retailers, who prefer to keep logistics data secret, Balakrishnan says. Instead, he used computer modeling, analyzing 3,125 different combinations of delivery operations and customer types.

On average, he found, compared with traditional paid delivery,

  • A universal FDS plan, where all customers pay the same subscription fee for unlimited free deliveries, generated 33.7% more overall profit.
  • A tiered plan, offering extra perks for higher fees, generated an additional 1.9% in profit over the universal plan.

The reason, he says, is that other factors increase profits enough to make up for what the retailer loses on shipping.

More purchases. 

“People who are subscribing to these plans buy more on average every year,” Balakrishnan says. Since they no longer pay separate shipping for each purchase, their cost per unit is lower, prompting them to purchase more. Companies benefit because they earn a profit margin on each purchase.

Locking in customers. 

Even heavy shoppers aren’t likely to sign up for every FDS service available. They’re likely to do more shopping with whatever retailer they’re subscribed to.

“Once you lock in a customer to a subscription, they may shift their purchases from other places, as long as the price is comparable,” Balakrishnan says.

Adding value.

In addition to free shipping, retailers can add other perks, such as access to online entertainment, exclusive sales, or different return options. If the package is attractive enough, customers might be willing to pay more than they would spend for shipping alone. Amazon Prime has steadily increased its price from $79 to its current $139 a year.

But FDS plans don’t work for all retailers and all customers. Some customers may not shop enough to make the plan worthwhile. Others may shop so often that it would hurt a smaller retailer to offer them unlimited free shipping, even with a fee.

Giving customers flexible options works best, Balakrishnan says. For example, a retailer can offer a subscription fee that includes free shipping but limits it to a specific number of orders.

The biggest takeaway, Balakrishnan says, is that a mix of FDS and pay-for-delivery (PFD) options can increase business for retailers while saving money for frequent shoppers. In homage to a well-known ad campaign for American Express, he considered titling his paper, “Membership Has its Benefits.”

Now that he’s shown how combining FDS and PFD can work for retailers, he says, the next step might be to look at how they can compete within these frameworks. Other avenues to explore include getting and analyzing empirical data from companies, and studying the economics of alternative business models for last-mile delivery operations.

“I see Amazon trucks almost every day making deliveries to multiple households,” Balakrishnan says. “If many of my neighbors are Prime subscribers, and they keep ordering often, the delivery costs get amortized over multiple deliveries. So, delivery costs for Amazon may be lower. I think this is very important for us to study later.”

Subscription Pricing for Free Delivery Servicesis published in Production and Operations Management.

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Consumers value animal welfare more than environmental sustainability when buying meat and dairy products – study

While consumers consider sustainability important, other factors such as taste, quality, and animal welfare take precedence in their purchasing decisions.

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The treatment of animals rates higher than green issues when consumers choose meat and dairy products.  

That’s according to a new study, which suggests that while consumers consider sustainability important, other factors such as taste, quality, and animal welfare take precedence in their purchasing decisions.

On product labels, consumers valued information regarding animal welfare, food safety, and health and nutrition. The results can help producers to market particularly sustainably produced food products in a more targeted way and make them more attractive to consumers.

The study was conducted across five European countries—Czechia, Spain, Sweden, Switzerland and the UK to identify the attributes that are most important to consumers buying meat or dairy products.

Taking part in an online survey, 3,192 participants were asked to rate the importance of 18 different factors when shopping for meat and dairy products on a scale from 1 (not at all important) to 5 (extremely important):

  • ·Attributes – freshness, quality/taste, healthy eating, nutrition, price, processing, special offers, convenience of use/preparation, and familiarity of brand.
  • ·Animal welfare attributes – animal welfare, outdoor-reared/free range, and pasture-fed.
  • ·Attributes related to environmental sustainability – locally produced, sustainable packaging, food miles, carbon footprint, and organic.
  • ·Social sustainability – Fair trade or producer/farmer fairly paid.

Across all surveyed countries, consumers consistently prioritised freshness, quality/taste, and animal welfare as the most important attributes. In contrast, environmental factors such as food miles, carbon footprint, and organic production were deemed less important in influencing purchasing decisions. However, sustainability labels were perceived as helpful among consumers.

Study co-author Dr Andy Jin, Senior Lecturer in Risk Management in the Faculty of Business and Law at the University of Portsmouth, said: “Our study highlights the complex interplay of factors that influence consumer behaviour when buying meat and dairy products. Consumers indicated that information related to animal welfare, food safety, and health and nutrition was considered more important than environmental sustainability when making food choices.

“The findings demonstrate the importance of labelling strategies that encompass multiple aspects of product attributes, beyond environmental considerations alone.”

The implications of the research extend further than consumers to policymakers, producers, and retailers in the food industry who are striving to meet evolving consumer demands for more sustainable products.

Dr Jin added: “Labels on their own are not enough to change behaviour, especially for consumers who have low or no behavioural intention to buy sustainable meat or dairy products.

“These results should be translated into additional policy measures, such as nudges or behavioral interventions, helping individuals translate their attitudes into behavior and facilitating the choice of sustainably produced products.”

The research, published in the journal Food Quality and Preference, was conducted by the universities of Portsmouth and Newcastle in the UK, Swedish University of Agricultural Sciences, University of Córdoba in Spain, Mendel University in Czech Republic and Agroscope from Switzerland.

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