Marketing Monthly - April 2013 by Mays Business School

April 2013: Vol. 8, Issue 2

Marketing Monthly Texas A&M University Sales Competition

Winners!

Sales Competition Winners

March began with a roar with Mays Business School playing host to the TAMU Sales Competition. In total, 66 students from across the campus participated in the contest which began Friday afternoon, March 1st. Students and company reps simulated actual sales interviews through challenging role-play scenarios . Nine marketing majors made it to the second round of competition on Saturday morning. Once the dust had settled after the rigorous final rounds, marketing students emerged victorious with two of the top four prizes. Seniors Kelsey McKey and Allyson Janes took second and fourth places, respectively.

Due to their competitive natures, the junior contestants have vowed to come back next year and sweep all the prizes. This university wide competition is cosponsored by three departments. Professor Charles Futrell oversees the Department of Marketing contributions, while Kerry Litzenburg organizes the Dept. of Agricultural Economics end of things and Norm Clark handles the Dept. of Industrial Distributionâ&#x20AC;&#x2122;s share. A total of 25 industry sales executives judged and played the part of buyers in the sales interview role-plays with the students. Sixteen organizational sponsors made the whole event possible. Continued next page

Sales Competition (cont.)

All participants came together for the Friday night banquet at the Memorial Student Center

Watching and judging the taped interviews

Sales contestants are judged on such things as their opening, presentation of features, handling of objections, closing, visuals, and professionalism. This year’s first round case started out like this: Restever Community Hospital , located in Restever, Texas, serves a generally rural community in the surrounding four counties. You have talked to Andy, the general manager of Restever on two previous occasions about converting their current manual hospital record system to the Premier Health Company’s webbased patient data system … New this year was the Industry Luncheon. It’s a way of saying thank you to our generous

Networking opportunities abound at the Competition

participants and also provides a great opportunity for faculty and industry representatives to get together to discuss an overview of the program as well as the working details of the event.  $11,750 in prize money was won by the top 20 competitors.  This is the 4th sales competition—25 students competed the first year.  The ‘best of the best’ took the sales challenge.  Twenty-one marketing majors, one finance major and one finance honors student competed to fulfill requirements for the Sales Certificate.

Sales Competition (cont.) Special Appreciation to the Sales Competition Sponsors Platinum Reynolds & Reynolds

Gold McAfee Smith and Associates SRS Distribution Silver DXP Enterprises MRC-Global Corporation Sewell Energy Alloys Otis Elevator TWG Insurance Bronze ARMOR Wealth Management Ferguson Hormel Foods, LLC DOW AgroSciences Hydraquip Union Pacific

Nine finalists from the Department of Marketing

MSC Friday night banquet

Jim Wright, Reynolds & Reynolds Sales Manager

Hard-working faculty and company reps at the new Industry Luncheon

Marketing Research in the NEWS!!! Ram Janakiraman and Rishika Ramkumar’s research has garnered loads of media attention. Their research investigates the pay offs to businesses that actively engage customers through social media. Two news articles featuring Janakiraman were broadcast on April 2nd on the local NBC news. Click here for links to the different interviews at 6pm and 10pm.

Title: “The Effect of Customers' Social Media Participation on Customer Visit Frequency and Profitability: An Empirical Investigation.” In Information Systems Research, March 2013. Authors: Rishika, Rishika (TAMU); Kumar, Ashish (Aalto University, Finland) ; Janakiraman, Ramkumar (TAMU); Bezawada, Ram (SUNY, Buffalo).

Abstract: In this study we examine the effect of customers' participation in a firm's social media efforts on the intensity of the relationship between the firm and its customers as captured by customers' visit frequency. We further hypothesize and test for the moderating roles of social media activity and customer characteristics on the link between social media participation and the intensity of customer-firm relationship. Importantly, we also quantify the impact of social media participation on customer profitability. We assemble a novel data set that combines customers' social media participation data with individual customer level transaction data. To account for endogeneity that could arise because of customer self-selection, we utilize the propensity score matching technique in combination with difference in differences analysis. Our results suggest that customer participation in a firm's social media efforts leads to an increase in the frequency of customer visits. We find that this participation effect is greater when there are high levels of activity in the social media site and for customers who exhibit a strong patronage with the firm, buy premium products,

and exhibit lower levels of buying focus and deal sensitivity. We find that the above set of results holds for customer profitability as well. We discuss theoretical implications of our results and offer prescriptions for managers on how to engage customers via social media. Our study emphasizes the need for managers to integrate knowledge from customers' transactional relationship with their social media participation to better serve customers and create sustainable business value. The following are the media mentions garnered by this article: TAMU Times Inc.com Calcutta News Albuquerque Express Herald Globe India4u.com TruthDive News Track India Yahoo! India News NewsroomAmerica India Vision News.SmasHits.com Computing Now Press News.org Webindia123.com Science Newsline Phys.Org Science Blog e! Science News Business News Daily World News Innovations Report Noodls High Text Verlag Alpha Galileo Alpha Galileo (DE) Science Codex

Book Publications The Thirteenth Edition of Fundamentals of Selling: Customers for Life through Service, and the Twelfth Edition of ABC’s of Relationship Selling through Service, by Charles Futrell are hot off the McGraw-Hill Irwin presses this month. Congratulations, Charles--keep up the good work!

Congratulations! Len Berry’s second publication from his 2012 field research in Wisconsin was published in the February 2013 issue of Mayo Clinic Proceedings, which reaches about 130,000 physicians worldwide. Title: “Care Coordination for Complex Patients in Inpatient and Outpatient Settings” Co-Authors: Beth L. Rock, RN, BSN, OCN; Beth Smith Houskamp, RN, MSN, BBA; Joan Brueggeman, RN, BSN; and Lois Tucker, RN, BSN; all affiliated with Gundersen Health, La Crosse, WI Abstract: Patients with the most complex health profiles consume a disproportionate percentage of healthcare expenditures yet often receive fragmented, suboptimal care. Since 2003, Wisconsin-based Gundersen Health has improved the quality of life and reduced the cost burden of complex patients with an integrated Care Coordination program. Those results are consistent with data from the most successful care-coordination demonstration projects funded by the Centers for Medicare and Medicaid Services. S pecifically, Gundersen’s program has been associated with reduced hospital stays, lower costs for inpatients, less inpatient

utilization, and increased patient satisfaction. Gundersen’s success is rooted in its team-based approach to coordinated care. Teams, led by a subspecialty-trained RN, have regular, face-toface contact with patients and their providers in both inpatient and outpatient settings; involve patients deeply in care-related decisions; access a system-wide electronic medical record that tracks patients’ care; and take a macro-level view of care-related factors and costs. Gundersen’s model offers specific take-home lessons for institutions interested in coordinated care as they design programs aimed at improving quality and lowering costs. This institutional case study provides a window into well-executed care coordination at a large health system in an era when major changes in healthcare delivery and reimbursement mechanisms are on the horizon. Suresh Ramanathan (Professor of Marketing, David R. Norcom '73 Endowed Professor) has been appointed to serve on the Editorial Review Board of the Journal of Retailing. Ramanathan also currently serves on the editorial review boards of the Journal of Consumer Research and Journal of Consumer Psychology.

Paul Busch Wins AMS National Teaching Award Paul Busch has been selected as one of the three recipients of the 2013 Academy of Marketing Science Outstanding Teacher Award. Busch will be recognized and presented with the award at the 2013 annual conference of the Academy of Marketing Science scheduled to be held in May 2013. At a special session of the conference, Busch and two other recipients of the award will share their insights on excellence in teaching. The AMS Outstanding Marketing Teacher program was initiated in 1999 to recognize and reward excellence in teaching and to provide a forum for outstanding teachers to share their classroom success with colleagues.

Regents Professor Paul Busch

Janet Parish has been busy with community service speaking engagements lately. On February 20, she spoke at a luncheon for the Arts Council of Brazos Valley. The title of the talk was â&#x20AC;&#x153;Service Excellence: Managing Expectations.â&#x20AC;? On March 6, Parish gave a presentation to high school students at Allen Academy about the principles of marketing.

Janet Parish speaking to the Arts Council of Brazos Valley

2013 Mays Marketing Research Camp Many thanks to PhD student Krista Li, for taking copious notes and writing this report.

Biases in InformationSeeking to Avoid Catastrophic Risk Robert J. Meyer, Gayfryd Steinberg Professor of Marketing and Co-Director of the Center for Risk Management and Decision Processes, Wharton School, University of Pennsylvania Dr. Meyer’s paper explores the biases that can arise when individuals have the opportunity to seek information that would allow them to avoid a potentially catastrophic financial event. He says that individuals are great at Robert Meyer talks about information seeking at Marketing Research Camp anticipating incidence, but really bad at anticipating tail magnitude. They are bad at learning from in choosing the risky asset, but they’ll also value experience; we almost never learn from the losses information asymmetrically. Those holding of others or near misses, and one experience of a positions in the risky asset undervalue information “non-event” seems sufficient to wipe out effective (an ostrich effect) while those holding positions in memories of previous losses. In some cases the the safe asset overvalue information (a curiosity culprit is not underestimating risk, but rather effect), relative to risk-neutral optimal benchmarks. avoiding knowing about it. Authors then report the findings of an In particular, Meyer and co-author C. Jeffrey experimental investigation in which participants Cai, focus on a stylized case where an investor display this state of dependence when deciding makes a series of choices whether to put funds into whether to purchase information, as well a number a safe asset that yields a certain small return or a of other biases in both information gathering and risky asset that yields a much higher return, but asset choice. Findings reveal that informationthat also carries the risk of a catastrophic loss. At gathering is influenced by hedonic factors that each point in time, the investor may purchase would not arise in a normative assessment of information about the probability of catastrophic information value, such as how close participants loss occurring in a given period. The authors first are to achieving a wealth goal and curiosity among explore this problem theoretically. Their research those no longer subject to risk. shows that if investors hold reference-dependent Continued next page preferences they will not only tend towards inertia

2013 Mays Marketing Research Camp (cont.) Questions & Answers:  What about people who have had one bad experience, does that experience make them more likely to anticipate bad events? People only suffer a short period of time but rarely learn from that experience after a while.  Could inaction and underestimation of the probability and consequences of bad events be because people assume other agents should control for such events? People have erroneous beliefs about probabilities.  Is this a one period game or infinite horizon game? This is an infinite horizon game but can end at any period. Individuals solve this recurrent decision.  In the case that consumers are not gathering information, is that a bias or a rational action? That is the purpose of this study. We will study if that is a correct decision or not.  Wealth matters because you would lose everything if the catastrophic event happens? Yes. Normally risk aversion is not a function of wealth.  Did you try de-biasing? Anchor and adjustment work. It has important public policy implications.  What if people are not looking at financial outcome but at excitement as when playing a video game? People are motivated to do well in the experiment.  The decision to gather information is in the risky state. You can also look at information gathering in the safe state. Theory predicts that people at the safe state should gather information at a higher rate than in the risk state. But this was not found in the data because people generally do not gather information.

Robert Meyer chats with MKTG PhD student Jun Ho Lim and a PhD student from the Department of Economics. Continued next page

2013 Mays Marketing Research Camp (cont.)

Robert Meyer and Rajan Varadarajan

Venky Shankar, Qi Li (ECON professor) and Robert Meyer

The Mays Marketing Research Camp is an annual research workshop that is aimed at bringing leading edge marketing scholars together to stimulate highquality research discussion and thinking. Each year, this one-day event is focused on a hot research topic. External speakers along with a Mays marketing faculty member present their current research. The workshop is attended by faculty and graduate students from marketing and related disciplines such as management, economics and psychology.

2013 Research Camp ~ Lehmann(cont.)

Don Lehman, George E. Warren Professor of Marketing, Columbia Business School, Columbia University

A Research Sampler: 2013 Don Lehmann Dr. Lehmann gave an overview of current research in three domains of marketing and presented two of his recent works. There is a tendency for firms to overstate quality in advertisement. Lehmann’s research paper titled “Quality and Quality Claims: the Impact of Competition and the Cost of Overstating Quality,” studies firms’ decision to advertise the quality of products. Previous work that studies this decision is limited to the monopoly setting. The impact of competition on firm’s decision is unclear. Lehmann studied two symmetric firms that compete on quality, price, and advertised quality and found interesting results. When the cost of overstating quality is low, competition drives both firms to overstate quality

(by about 20%), i.e., in equilibrium, advertised quality is greater than actual quality. When the cost of overstating quality is high, actual quality is lower than when the cost of overstating quality is low. Thus, imposing legal costs on quality overstatement ironically leads to firms supplying lower quality goods. The second paper “Strategically Ordering Brand Extensions” studies how a firm should order the introduction of a brand extension. Should firms follow a specific order or diversify broadly early on to set consumer brand expectation and concept? Lehmann and his coauthors conducted a series of experiments which vary orders and measure consumer reactions to different orders. Interestingly, results show that disorderly introduction leads to better results.

2013 Research Camp (Lehmann cont.) Questions & Answers: • A forward-looking monopolist would overstate to create a barrier of entry? True. This game is a simultaneous game with symmetric firms without entries. • Why are firms better off at lower levels (50)? What is the intuition that both firms would want to under-advertise quality? Firms do so because if they overstate quality, they would be punished in the second period. If you are honest, you do not pay a legal cost. • All tire makers lie and overstate quality. Consumers don’t trust any of the advertised quality.

• What is the effect of WOM on firm’s decision? If there is no legal cost, would the WOM effect lead firms to truly advertise quality? There are verifiable quality and unverifiable quality. The verifiability of quality may change the results. • What is the real world example of the reversing order? GE and Mitsubishi. • How does credibility affect consumer perception? Confidence is used as the contract in this paper. Once the evaluation is set and is strong, then the surprise versus fit will affect evaluation. This is a sequential process. • Do you get similar results if the products are not so different? Not so much.

Dr. Lehmann discusses research with PhD student Wonjoo Yun.

2013 Research Camp ~ Mayzlin (cont.) Promotional Reviews: An Empirical Investigation of Online Review Manipulation Dina Mayzlin, Associate Professor of Marketing, Marshall School of Business, University of Southern California Online reviews could, in principle, greatly improve the match between consumers and products. However, the authenticity of online user reviews remains a concern. Firms have an incentive to manufacture positive reviews for their own products and negative reviews for their rivals. Mayzlin presented her empirical paper on promotional (fake) reviews which is a follow-up of her job-market paper that studies promotional reviews with an analytical approach. Mayzlin examines both the extent to which fakery occurs and the market conditions that encourage or discourage promotional reviewing activity. Specifically, she examines hotel reviews, exploiting the organizational differences between two travel websites: Expedia.com and Tripadvisor.com. While anyone can post a review on Tripadvisor, a consumer could only post a review of a hotel on Expedia if the consumer actually booked at least one night at the hotel through the website. Mayzlin isolates hotels with a disproportionate incentive to engage in promotional reviewing activity by exploiting the differences in the distribution of reviews for a given hotel between Tripadvisor and Expedia. Several interesting results are obtained. First, the net gains from promotional reviewing are likely to be highest for independent hotels that are owned by single-unit owners and lowest for branded chain hotels that are owned by multi-unit

owners. Second, hotels with a high incentive to fake have a greater share of five star (positive) reviews on Tripadvisor relative to Expedia. Furthermore, the hotel neighbors of hotels with a high incentive to fake have more one and two star (negative) reviews on Tripadvisor relative to Expedia.

Dina Mayzlin talks about online hotel reviews

2013 Research Camp (Mayzlin cont.)  Questions & Answers:  Do you know which review is real and which is fake? There could be very positive and very negative reviews which are real. Consumers may not read the detailed reviews and could be influenced by the overall volume of positive and negative reviews. Yes, it is very hard to judge the fakery of reviews. Some sophisticated consumers may write fake reviews.  Would the number of true reviews overwhelm the fake reviews? In the analytical paper, it is positive for firms to manipulate reviews even though there is a cost of faking reviews.  Could the ownership structure also measure the difference in the quality? The big hotels have high quality. Consumers may not need to look at reviews to make decisions. The small hotels are unfamiliar to consumers, so consumers would want to read reviews.  Do both websites list the same hotels? Are their variations in hotel listings? Do they have the same algorithm to list the hotels in a similar order? Data didn’t show any major differences.  What happens to the links between Tripadvisor and other websites? Smaller hotels may care about reputation more because that is all the hotel has to lose. Bigger hotel chains may care less about reputation as they can absorb adverse information internally.  Do large hotels have social media marketing policy? Smaller hotel managers have more incentive to fake. Bigger chains are less likely to fake reviews.  Orbitz publishes both verified and non-verified reviews. Are their summary statistics of the two kinds of reviews? Larger hotels absorb negative reviews internally instead of publishing that information to public. They can compensate consumers with low satisfaction.  Are there other confounds for using Tripadvisor and Expedia to figure out the

proportion of fake reviews? The focus of the paper shifts more toward the neighbors’ competition rather than the ownership structure.  Does the total number of reviews matter? The ratio of positive reviews out of 100 reviews could be more objective than the same ratio of positive reviews out of 2 reviews. A robustness check can be done. If the total number of reviews doesn’t matter, it can strengthen the result.  Are there persistent differences between reviews of two sites over time? Would the difference vanish over time? Would you look at prevention and promotional reviews? Difference between the two sites could lead to different ratings on the two sites. There could be fundamentally different types of consumers who post reviews on Tripadvisor versus Expedia.  Do you have the number of reviews in the model as a control variable? Missing variables could affect the average. The three neighbor variables are correlated. It is difficult to interpret the “has a neighbor” effect.

Dina Mayzlin and Venky Shankar

2013 Research Camp ~ Ramanathan (cont.) Effects of Focus of Attention on Desires and Resistance Towards Temptations Suresh Ramanathan, Professor of Marketing, Mays Business School, Texas A&M University Co-author: Wilhelm Hofmann, University of Chicago, Booth School of Business Ramanathanâ&#x20AC;&#x2122;s research examines why people indulge themselves. He presented three studies in support of a modified dual-process model of indulgence that proposes elaboration on desires as the driving mechanism. In Study 1, using a visual probe task, Ramanathan and his co-author measured participantsâ&#x20AC;&#x2122; attention biases towards hedonic options relative to healthy ones and found that sustained attention towards hedonic options predicted subsequent indulgence behavior. In Study 2, he manipulated attention towards hedonic or healthy options and measured the moment-to-moment desire and resistance towards desserts. Using a novel analytical technique called Recurrence Analysis, he established that impulsive people had more recurrent or repeated patterns of desires and were stuck in a state of desire longer in the hedonic focus condition than in the control and health focus conditions but did not differ in levels of resistance. Prudent individuals had more recurrent resistance when they focused on either hedonic or healthy options (vs. control) but were not different in desire across the conditions. In Study 3, the timing of reward sampling moderated these effects, with reward sampling before attention focus, revealing an ironic rebound in desires for impulsive people focused on healthy options.

Suresh Ramanathan speaks on desires and temptations

2013 Research Camp ~ (cont.)

Suresh Ramanathan and Sanjay Jain

Len Berry and Don Lehmann

The Mays Marketing Research Camp, under the leadership of Venky Shankar, has been an annual event since 2006. Previous camps have featured scholars from the following universities: Northwestern University, University of Chicago, Duke University, New York University, DartmouthCollege, Carnegie Mellon University, University of Michigan, University of California-Los Angeles, University of Southern California, University of Florida-Gainesville, Georgia Institute of Technology, Emory University, Georgia State University and many others.

Congratulations! At the 2013 AMA Marketing Educators’ Winter Conference, our distinguished colleague Venky Shankar was presented the 2012 American Marketing Association Marketing Strategy Special Interest Group Mahajan Award for Lifetime Contributions to Marketing Strategy Research, Education and Practice. You might enjoy watching a portion of the video from the award ceremony. The video clip has two parts. The first part is a toast by one of Venky’s former doctoral students Thomas Dotzel (with input from his other former doctoral students) highlighting some unique traits of Venky which underlie his impressive scholarly accomplishments. They include Venkytasking, Venkyhours, Venkynap, Venkyspeed, Percevenkyrance, Venkypassion, and Venkyachievements. Thomas’ presentation includes some very complex equations on the above traits. The second part of the video clip is Venky’s acceptance speech. Click here to see the video.

The following paper by Tarun Kushwaha ’07 (UNC) and Venky Shankar has been accepted for publication in the Journal of Marketing. Title: Are Multichannel Customers Really More Valuable? The Moderating Role of Product Category Characteristics Abstract: How does the monetary value of customer purchases vary by customer preference for purchase channels (e.g., traditional, electronic, multichannel) and product category? The authors develop a conceptual model and hypotheses on the moderating effects of two key product category characteristics—the utilitarian versus hedonic nature of the product category and perceived risk—on the channel preference– monetary value relationship. They test the hypotheses on a unique large-scale, empirically generalizable data set in the retailing context. Contrary to conventional wisdom that all multichannel customers are more valuable than single-channel customers, the results show that multichannel customers are the most valuable segment only for hedonic product categories. The

Venky Shankar receives the 2012 Mahajan award from Prof. Roger Kerin, former Editor of Journal of Marketing

findings reveal that traditional channel customers of low-risk categories provide higher monetary value than other customers. Moreover, for utilitarian product categories perceived as high (low) risk, web-only (catalog- or store-only) shoppers constitute the most valuable segment. The findings offer managers guidelines for targeting and migrating different types of customers for different product categories through different channels. Alina Sorescu, Sorin Sorescu, Bart Devoldere (2011 visiting scholar from Vlerick Business School, Belgium) and Will Armstrong (Texas Tech) have won the Best Proposal Award at the Strategic Management Society Lake Geneva Special Conference for their paper “Epochal Innovations and Stock Market Bubbles”. The theme of the conference was Strategizing Practices from the Outliers: Enabling “Big Bang” Innovations. The program included 110 academic presentations and was held Mar 20-23, 2013. Conference website

Advertising Career Panel Paul Busch’s MKTG 347 Advertising Classes recently benefited from Advertising Career Panel Day. Students were free to ask any question related to an advertising career. Breakfast and lunch were served and students were able to mingle with the panelists between sessions. Panelists: Michael Albrecht, Love Advertising Travis Hopper, O&H Brand Design Lindsay London, Slingshot LLC Maria Sommer, The Marketing Arm Mallory Schatte, TM Advertising Career Panel Day

Student Takeaways ~The main things I learned from the career panel are the ways to make a successful impression at work. You should always act professionally regardless of the occasion. You should always be willing to stay after to complete your work or help others. The fastest way to build ties is to build a network by helping each others in their time of need. This will not only help you with work relationships, it will help you climb the career ladder. ~…it was very enlightening. One of the major aspects I learned about was an advertising career in general. They discussed two different sides: the client v. agency side.

I hadn’t thought about these areas being so distinctively different before. Also I have never heard much about cultures of advertising agencies. This panel gave me some insight into the fun, creative, social, and sometimes competitive environment of agencies. The most valuable lesson I took away was very basic to any profession--the advice on using your networks, even when they don’t seem promising. Make sure you triple check everything you write because that is essential. Finally, be aware and try to make everyone around you better, that in turn will make you better.

~I learned about different positions within ad agencies and how their day-to-day duties and relationships with clients change. I also learned about different types of ad agencies; some are focused primarily on design while others are geared more towards promotional work. ~…finding an agency that aligns with your values, goals, and ideas is critical. If you do not fit in with the culture, no matter how qualified you are, odds are they will not hire you. Also, excellent writing and communication skills are a must.

CRS News & Updates H-E-B Day Over 2,000 students participated in the 2013 H-E-B Day at Texas A&M University. Twenty executives crisscrossed campus speaking in the colleges of business, liberal arts, and agriculture. Their goal was to showcase the diverse job functions and necessary expertise required to successfully run the San Antonio-based grocery chain. It surprises many people that H-E-B is a $20 Billion Dollar retail business. With bakeries, warehouses, dairies, truck fleets, and multiple store formats, including Central Market, Joe V’s and Mi Tienda, H-E-B is the largest privately held company in Texas. It employs over 75,000 people, and annually receives almost 1 million applications. “H-E-B is committed to being the best retail store in America” said Rob Hall, VP of the Gulf Coast Region. “It is also an extraordinary place to work.” Hall, along with many other partners who attended a luncheon with students, has almost 30 years of experience with the company. His cousin, Jody Hall, Director of Global Sourcing, recruited him. Together, they emphasized the diverse career opportunities with the company including store operations, finance, HR, data analysis, and more. They also spoke about values. “The partnership with Texas A&M is very special. We share common values in integrity, community, service, excellence and leadership,” said Rob Hall. Innovation was another theme. In his presentation to students in MKTG 425 Retail Merchandising, Jody Hall described H-E-B’s commitment to finding the best products for its customers, anywhere in the world. Recent finds includes a line of tomatoes from Israel and a Spanish based-bakery that will open in San

Antonio, bringing new jobs and new flavors to Texas. In total, H-E-B offers over 11,800 of its own brand products. Private label is only growing. We thank H-E-B and the H-E-B leaders who participated for sharing of their time and knowledge at Texas A&M University: Rob Hall, Gulf Coast Regional Group Vice President Melissa Mueller, Director of Human Resources for Gulf Coast Region Juan Alonso, Regional Vice President for Houston West Region & Mi Tienda Division Patrick Walther, Director of Loyalty Advertising and Software Development Centers Jim Alcock, Sr. Facility Leader of Transportation Ron Ozment, Director of Supply Chain Strategy at HEB Jody Hall, Director of Global Sourcing Thomas Greenway, Manager of Supply Chain Tony Atkins, Unit Director in College Station Mike Newkham, Unit Director in College Station Lynette R. Padalecki, Group Vice-President, Corporate Planning & Analysis Rich White, Unit Director in Bryan Sarah Blanchard, Continuous Improvement Manager for the Manufacturing Division Mike Warren, Director of Corporate Merchandising & Grocery for the Houston Division Mike Jarzombek, Vice President of Meat Operations Susan McCloud, Director of Recruiting Derek Kirchner, Director of Product Safety and Quality Assurance Joe Gonzales, Regional Merchant for Market for Houston Division

CRS News & Updates Retail Speaker Profile Giles Bowman, Senior Vice President of Merchandising, The Home Depot Giles Bowman is senior vice president of merchandising and building materials for The Home Depot. He oversees the lumber, building materials, bath, electrical and millwork departments. Giles has more than 22 years of experience in the home improvement industry. Prior to his current assignment, he was senior vice president of merchandising, hardlines, for The Home Depot. He previously held several positions of increasing responsibility, including merchandising vice president of building materials, merchandising vice president of the Eastern Division, merchandising vice president of Canada, vice president of sales and service for the Southwest Division, divisional merchandise manager of the Southwest Division, and millwork merchant for the Southwest Division. Bowman visited Mary Zimmerâ&#x20AC;&#x2122;s Retailing and Consumer Behavior classes on February 6 , and provided many insights about the target consumers of The Home Depot. Giles described three segments: the Do-It-Yourself Customer, the Do-It-For-Me customer who is a little older, more affluent, and wants more services, and the smallest, most profitable customer, the Contractor. The Home Depot customer wants value first, both a good price and more benefits. Second, they want new products. The latest and greatest comprise about a third of online sales. Third, they find innovations appealing. For example, easy to install products, lightweight materials, and easy to understand instructions help sell products. Giles emphasized that merchants live and die

by numbers. His background in mathematics has been put to good use. He also focused on people. His business is all about relationship building, with both consumers and vendors.