Yewon Kim
Assistant Professor of Marketing, Stanford Graduate School of Business
yewonkim[at]stanford.edu
I am an Assistant Professor of Marketing at the Stanford Graduate School of Business. My research interests lie broadly on how information frictions shape consumer and firm behavior in various markets and which interventions can effectively reduce such frictions, especially for agents (either consumers or firms) new to the market. I work on the topic of sustainability as well, studying what drives sustainable consumption and production using field data.
I find the arts industry an exciting and important research setting, as its market structure, as well as the experiential nature of the products (e.g., classical music concerts, art exhibitions), constitute interesting quantitative marketing laboratories to study consumer preferences and the impact of information.
Publications
Government policy, strategic consumer behavior, and spillovers to retailers: The case of demonetization in India, with Pradeep Chintagunta and Bhuvanesh Pareek. Marketing Science 41(6), 2022.
This paper studies strategic consumer shopping behavior in response to a macroeconomic policy in the case of currency reform, and quantifies its unintended consequences for retailers vis-a-vis the policy goal. Using transaction-level data from a large retail chain in India, we document consumer strategies that leverage the presence of retailers to avoid costs associated with the country's currency reform policy. We observe both an increase in returns of cash-purchased items that were bought before demonetization (strategic returns) and a spike in final (unreturned) cash purchases with soon-to-be-illegal notes (strategic purchases). Both practices serve consumer incentives either to receive legal notes from the retailer or to avoid depositing cash in formal bank accounts. Our analysis suggests that strategic consumers benefited the retail chain overall while partly hindering the intended effect of the policy, leaving more than 20 million INR (0.3 million USD) of demonetized notes outside the formal tax network through this retail chain only; when we scale up the estimates to the country's market size, the estimated total impact is at least 100 billion INR (1.5 billion USD). Our findings (i) offer implications for policy makers by quantifying a wide spillover effect of government interventions that goes beyond the target group, and (ii) document a new role of the retail industry - of absorbing, and facilitating a response to, macro shocks.
Working papers
Sustainability and Strategic Differentiation: Rising Preferences and Divergent Brand Strategies in Unregulated Consumer Markets, with Kristina Brecko, 2024.
- Presented at 2022 Stanford-Berkeley IO Fest, 2023 Marketing for Sustainability Conference, 2023 VQMS, 2023 Choice Symposium, 2024 INSEAD Marketing seminar, 2024 Cornell Marketing seminar, 2024 Bass FORMS Conference, 2024 Stanford Human Behavior and Sustainability Conference, 2024 Stanford BGS FlashTalks, 2024 Yale InsightsOn Conference
- Previously presented under the title of "Voluntary provision of sustainability claims: Evidence from Consumer Packaged Goods", and "Supply and Demand for Sustainability Features: Drivers and Deterrents under Voluntary Labeling"
- Funded by Stanford BGS grant ($50,000)
This paper examines how and why systematically differentiated strategies in sustainability emerge across brands despite the rising preference for sustainability in unregulated consumer packaged goods (CPG) markets. Focusing on the health and beauty care categories between 2013 and 2019, we find that the increasing prevalence and market share of products with sustainability features are primarily driven by fringe brands rather than historically dominant ones, with sustainability features playing only a secondary role in product pricing. Our model estimates reveal a consistent explanation for these patterns: although overall consumer preference for sustainability is increasing, most consumers still place much greater importance on non-sustainable product attributes and favor sustainability features that smaller brands can provide at relatively lower costs than large brands. Consequently, dominant brands have little incentive to invest in sustainable products, leading to a market where they offer less preferred, lower-cost, and lower-priced sustainable alternatives, whereas smaller brands offer more preferred, higher-cost, and higher-priced options to differentiate themselves. These findings have implications for brands and policymakers promoting sustainability.
- Presented at 2022 Stanford-Berkeley IO Fest, 2023 Marketing for Sustainability Conference, 2023 VQMS, 2023 Choice Symposium, 2024 INSEAD Marketing seminar, 2024 Cornell Marketing seminar, 2024 Bass FORMS Conference, 2024 Stanford Human Behavior and Sustainability Conference, 2024 Stanford BGS FlashTalks, 2024 Yale InsightsOn Conference
- Previously presented under the title of "Voluntary provision of sustainability claims: Evidence from Consumer Packaged Goods", and "Supply and Demand for Sustainability Features: Drivers and Deterrents under Voluntary Labeling"
- Funded by Stanford BGS grant ($50,000)
This paper examines how and why systematically differentiated strategies in sustainability emerge across brands despite the rising preference for sustainability in unregulated consumer packaged goods (CPG) markets. Focusing on the health and beauty care categories between 2013 and 2019, we find that the increasing prevalence and market share of products with sustainability features are primarily driven by fringe brands rather than historically dominant ones, with sustainability features playing only a secondary role in product pricing. Our model estimates reveal a consistent explanation for these patterns: although overall consumer preference for sustainability is increasing, most consumers still place much greater importance on non-sustainable product attributes and favor sustainability features that smaller brands can provide at relatively lower costs than large brands. Consequently, dominant brands have little incentive to invest in sustainable products, leading to a market where they offer less preferred, lower-cost, and lower-priced sustainable alternatives, whereas smaller brands offer more preferred, higher-cost, and higher-priced options to differentiate themselves. These findings have implications for brands and policymakers promoting sustainability.
Customer retention under imperfect information, 2022. R&R, QME. (Draft available upon request)
Firms often see customers churning quickly after limited product experiences. This paper examines whether such early churn is solely driven by customers' low preferences for a given firm or influenced by incomplete information about available products. Using ticket purchase data from a major U.S. symphony center, I find that concert choices exhibit within-customer changes over time that align with predictions under consumer learning. These patterns suggest that 1) first-time customers have incomplete information about concerts and 2) the choices of experienced customers reflect a concert's true average consumption utility ("concert value"). Reduced-form analyses show that the estimated concert values inferred from experienced customers' choices are not correlated with first-timers' initial concert choices but are strongly correlated with their subsequent churn, indicating that an initial visit made under imperfect information shapes a customer's expectations about future concerts. Counterfactual analyses using a structural model highlight the challenge of regaining customers after an initial low-value experience, emphasizing the importance of pre-visit interventions (e.g., introductory marketing, assortment design for first-time customers) in reducing early churn.
Valuing brand collaboration: Evidence from a natural experiment, with Sanjog Misra and Bradley Shapiro, 2020.
We study complementarities between brands in the context of collaborations across museums. Over the course of our sample, one major museum with a highly recognized brand closed temporarily and sequentially collaborated with two established local museums. With individual panel data on museum memberships around these events, we measure how collaborations affect demand using an empirical framework of complementarities that are newly applied to the branding context. We observe two counter-acting demand patterns. First, customers with no history of buying membership from either museum enter the market, suggesting brand complementarities. Second, a sub-group of customers who previously purchased from either or both of the museums display decreased demand, consistent with brand dilution. Any structural approach that models the demand for collaboration with existing preferences for separate brands fails to create accurate demand predictions. The magnitude of the offsetting forces varies between collaboration events, which makes demand prediction even more challenging. These results call for a theory of brand being beyond a fixed utility primitive and have implications for counterfactuals that involve combining or altering of brands.
Work in progress
Sustainable Technology in the Lemons Market: The Case of Battery Choices by Electric Vehicle Owners in Bangladesh, with Amrita Kundu and Erica Plambeck, 2024.
- Invited to present at 2024 INFORMS Annual Meeting
- Presented at 2024 China-India Insights Conference (plenary session)
- Funded by Asian Development Bank ($77,000 grant)