ADOPTION AND SCOPE OF HEURISTICS IN FASHION BUSINESS TO BUSINESS MARKETING: AN EXPORATIVE CASE RESEARCH

Simone Guercini 글로벌지식마케팅경영학회 2017 Global Fashion Management Conference Vol.2017 No.07

This contribution focuses on fitting between heuristic rules and the task environment in business to business market. The subject is about evidence-based business decision-making process in the business actors‟ perspective. The empirical setting of fashion business to business markets is considered, focusing on adaptive behavior situated in the interaction processes in customer-supplier relationships emerging from empirical researches. The paper considers two key aspects of the process: (1) the origin and diffusion of the heuristic rules adopted by the actors (adoption) and (2) the fields in which the rules can be used (scope) are discussed. The central research questions are: How heuristics are adopted and diffused in the fashion business to business environment (adoption)? How wide is the context in which the heuristic rule is applied by the actors (scope)? Fashion business to business markets is our setting of analysis. First of all we have to define what are heuristics. Studies of decision-making processes generally divide them into two, mutually exclusive types: rational decision making versus rule-based decision making (March 1994). In the case of rational decision making the approach is to evaluate the consequences of any decision in terms of either pure (maximizing) or limited rationality (satisficing). In rational decision making, consequential choices are adopted, hence an evaluation of preferences and expectations is necessary and decisive to the final outcome. Instead, in rule-based decision making, what counts most is following the rules, the aim being to satisfy and/or define an identity. In rule-based decision making, rules deemed appropriate are adopted, and what then counts are the rules and the identity, which form the basis for taking well-thought-out actions. Rationality requires less „specific‟ knowledge, since it relies on abstract rules. In this approach, following the rules may instead involve understanding them in relation to the specific context in which they are to be applied. The relations between heuristics and interaction in business networks provide a means to study other aspects of the evolution of the relationship between enterprise and business market environment (Artinger et al. 2015; Guercini et al. 2014, 2015). In fact, the network of relationships the actors adopt images of the relationships to be cultivated with the precise aim of formulating an effective representation of the market, enable other phenomena to be examined, not so much in their qualitative aspects, but rather as regards their importance as perceived by business decision-makers. In light of these relations between heuristics and setting, the essential properties of heuristics that we propose to examine herein are: (1) specificity, intended as the field of application and setting in which any heuristic rule is generated and routinely applied; (2) convergence, which concerns how widespread, at least in appearance, any given heuristic rule is amongst actors in a given market setting (Guercini 2012). In other terms, the heuristics of entrepreneurial marketing can be considered specific to this particular setting, in that they concern the degrees to which such rules are generated, are successful, and are confined to the specific setting or context. Looking more closely at the two above-mentioned properties, specificity is high when, for instance, a heuristic refers to a specific, circumscribed matter (for example assessing the opportune moment to purchase certain semi-finished goods) and finds no application in any other setting. Conversely, a rule‟s degree of specificity is low when its field of application is broad: a rule may, since its inception, be applicable to many different fields, or it may be initially applicable only to a limited range of decisions, but subsequently find fruitful application in other, broader matters (Guercini et al. 2014). The degree of convergence instead regards the frequency with which a given heuristic rule is adopted within a population, a community or, in our case, by entrepreneurs. Such adoption may only be apparent, in the sense that what seems to be a single rule may actually represent various, subtly different rules for each individual, given the supremely personal, individual nature of fine mental processes. Evaluating the degree of convergence of a given heuristic within a population obviously involves measuring its dissemination in terms that are recognized as such by the researcher. Convergence is high for rules adopted by everyone, or at least by a large segment of the population in question. Other heuristic rules are instead developed by individuals in forming their personal judgments and seem to be unique to such individuals, in that they do not arise in others. This implies that heuristic rules may be the source of a relative advantage for the entrepreneur, in so far as the heuristic in question proves itself successful, that is, an element that determines a good choice when other methods are ineffective or may even produce negative effects. Specificity and convergence are thus general properties of the heuristics adopted by entrepreneurial marketers, and are strongly tied to the interpersonal relationships and consequent interactions within business decision-makers‟ personal contact networks (Guercini et al. 2015). Heuristic procedures are easily detectable in the descriptions of enterprise top management of the processes they utilize in assessing possibilities and forming judgments. Some of these procedures are highly abstract and applicable to various different settings, for instance, regarding problems typically facing firms as well as purchase decision-makers. In the following we shall briefly present some of the heuristics encountered in our research; a more detailed description and more rigorous modeling of their characteristics will be addressed in future work. Let us consider now a fashion business to business settings, and more precisely the situation in which the decision-maker of a fashion firm is tasked with formulating a judgment regarding the best choice of colors to keep up with the fashion trends of coming seasons. From interviews with representatives of styling divisions, what repeatedly emerged was their conviction that “strong” colors periodically and forcefully come back in fashion. Some even went so far as to specify the duration of this cycle: seven years – that is, the same as the number of strong colors –, which also turns out to be coherent with long-standing observations on the limits of human cognitive function (Miller 1956). No clearly defined explanation was offered of the reasons for, or origins of, this rule, although some hypotheses were advanced: simply that a sort of “law” was first noticed and then became consolidated as its predictions were repeatedly verified over time. A second example is that of the textile firm entrepreneurial marketer called on to provide a forecast of the fabrics that will be most widely utilized in the market over the next few seasons. From the marketer‟s perspective, the price of natural fibers is one element on which to base any judgment regarding future fabric usage trends. Clearly, there are technical time constraints on the purchasing of fibers for spinning, which must naturally precede the sale of the fabric, and may even take place already in the stage of drafting the fabric sample book. Thus, a specific assessment rule is applied: those fibers whose price increases during certain periods of the year are deemed to be those that will be in most widespread use the following season. However, for some years now this rule has begun to seem less reliable than in the past. Workers in the sector speak of greater complexity in the wool market, where supply factors, such as international manufacturers‟ policy of stepping up fiber tops production, have had the effect of upsetting traditional market dynamics. The heuristic rules in these examples can be regarded in the perspective of the attributes they present, in particular, their “specificity” (or field of application) and their “convergence” (or degree of dissemination). A rule that is highly specific to a certain application setting looses much of its value when applied to judgments other than the one for which it has been developed. On the other hand, a rule that is in widespread use in many firms can hardly become a distinctive resource for entrepreneurial marketers. The widespread dissemination of a given heuristic rule amongst the rules “in stock” or the “adaptive toolbox” of firms may influence its effectiveness. Indeed, the fact that a rule is shared by many may justify its adoption in light of the validity that the decision-makers seem to attribute it, even if it is less probable that its use impart a distinctive competitive advantage. The examples of heuristic processes presented in the foregoing seem to enjoy different degrees of specificity and convergence. The association of certain heuristics to specific settings takes on the significance attributed to them by Simon (1979), as rules bound by the task environment and not clearly referable to relatively abstract mechanisms or endowed with autonomy. Mechanisms applicable to less specific settings are instead referable to the heuristics described by Tversky and Kahneman (1974), including representativeness, availability and adjustment/anchoring, identified in relation to the possible distortions and errors associated to them. The heuristics modeled by “building blocks” by Gigerenzer et al. are seemingly cannot be captured by a few categories, given the variety of formal models identified. Briefly, these include (1) recognition heuristic; (2) fluency heuristic; (3) take-the-best; (4) tallying; (5) satisficing; (6) 1/N equality heuristic; (7) default heuristic; (8) tit-for-tat; (9) imitate the majority; (10) imitate the successful; (11) hiatus heuristic; (12) fast and frugal trees; (13) mapping models; (14) averaging the judgment; (15) social circle; (16) moral behavior (Gigerenzer and Gaissmaier 2011, Gigerenzer and Brighton 2009). In the approach proposed by Gigerenzer and his “adaptive behavior and cognition program”, formal models are necessary to evaluate the real contribution of heuristics to cognition, decision-making and behavior. For details, refer to the publications of the adaptive-behavior-and-cognition program (Gigerenzer 2007; Todd and Gigerenzer 2012). Rule-based decision making implies the availability of rules to follow and consistency with an established identity as the driving factors in the decisionmaking process. If the rules satisfy an ecological rationality approach, are such rules then the result of a process of rules selection with which the decision makers are endowed innately or they are formed through a process of learning? And, if the latter is true, what are the characteristics of the decision-making process during the stage that the rules formation schemes are more open? And lastly, when the rules have already been defined, are they necessarily stable or can they be questioned and, if so, in what terms? These research questions are part of the future research stimulated by this first exploration based on case study research.

Integrating Design and Fashion Marketing

( Simone Guercini ) 한국마케팅과학회 2012 Journal of Global Fashion Marketing Vol.3 No.1

Fashion business processes and time are more and more related to the retailing and consumer rhythms than to traditional manufacturing timetables (Sheridan et al. 2006). Relation between design and marketing capabilities are evolving generating a field of innovation for the fashion firms. This special section of Journal of Global Fashion Marketing aims to offer a discussion about specific aspects of the interface between fashion design and marketing. More precisely the two articles included in this special section uses secondary research and interviews in depth with management of specific kinds of fashion firms. The first article, by Preiholt (2012), aims to uncover the reasons why fashion appears in terms of collective selection in a movement towards individual style in the way people dress. Here, fashion is viewed in terms of collective fashion trends and personal style. Thus, it is the clothes, dressing habits, and garments that are observed in the research. The paper shows how the theory of symbolic interactionism can be used as an analytical tool to bring transparency to the movement from collective selection towards individual style in the fashion industry. This theoretical approach, which is connected to social interaction helps avoid the classical research trap of making statements through the study of cause and effect. The analysis is made based on examples of meanings created around the garment through an observation of the process from the initial meaning the person gives to as a symbol in social interaction, to the final stage when it becomes an individual style. There are four such phases that together create the final picture of why fashion is heading towards individual style. All these phases have different sources, and naturally provide different answers to the initial research question in this paper. Once the garment is turned into an individual style and, as customers seek more details in garments, there then occur a collapse of the "total look" towards hyper individuality. The second article, by Guercini and Ranfagni (2012), examines the bureaux de style (style agencies) as producers of fashion trends and their interactions with textile firms in order to analyze their contribution in terms of knowledge and of competence to textile innovation processes. The business relationships for innovation has considerable current importance in the textile sector. Although this industry is considered mature, product innovation, based on the generation and exploitation of fashion trends, represents a fundamental strategic option to face the increasingly competitive pressure. In particular the paper tries to answer the following questions: How do the bureaux de style produce knowledge to generate fashion trends? What are the interactions between bureaux de style and textile firms in the production and sharing of fashion trends? What contribution do these interactions make to the textile product innovation? The research of Guercini and Ranfagni is based on an examination of the literature, on an analysis of secondary data and on deep interviews with managers of bureaux de style located in Italy and in France. The relation between fashion design and marketing is analyzed in these papers under different views and generate insightful perspective about the future of the fashion industry and important managerial implications. We believe that integrating fashion design and marketing is a fundamental topic to understand future of innovation in the fashion business and further research on the topic is needed in the next future.

RETAIL STORES OPENINGS AND CUSTOMER EXPERIENCE IN INTERNATIONAL MARKETS. THE CASE OF ITALIAN LUXURY MANUFACTURING COMPANIES

Simone Guercini,Andrea Runfola 글로벌지식마케팅경영학회 2015 Global Fashion Management Conference Vol.2015 No.06

Introduction This article analyzes retail store openings of luxury fashion brands in international markets. Our aim is to point out the relevance of this market entry strategy as well as to highlight the main destination markets and different trends over the 2004-2013 period. More precisely, this article analyzes the role of the retail direct channel as a means to manage relationships with consumers in international markets. The choice to develop retail operations in international markets is considered in this article as one of the key strategies implemented by luxury manufacturing companies. However, it seems to have received minor attention in the academic literature dealing with internationalization (Guercini and Runfola, 2014). Consequently, the main aim of this article is to propose empirical evidence to support the widespread use of this strategy by luxury firms, proposing the analysis of an original database built on the retail store operations of a sample of Italian fashion luxury companies over the period 2004-2013. The retail marketing strategy is a peculiar strategy within the luxury marketing strategies. As stated by Kapferer and Bastien (2012), in fact, through retail store openings (and distribution in general), luxury companies may implement and take advantage from what has been defined by the authors the “watchword of luxury brand management” (p. 233) namely “experience”. In fact, the literature in the field of luxury retailing has pointed out the role of the point of sale from a consumer point of view to experience the value of a company. The discussion on the consumer perspective is increasing in the literature as testified by various contributions aimed at analyzing and discussing how and what kind of experiences could be transferred by the opening of retail stores and in what terms the luxury retail strategy differs from other retail marketing strategies (Dion and Arnould, 2011). The opening of retail stores from luxury companies has been considered within the stream of research on the internationalization of the company. It has been pointed out that companies with luxury positioning can differentiate their offering with respect to mass market retailers and open retail stores even in culturally distant markets (Hutchinson et al. 2009). These openings, however, are considered more as ways of promoting the brand, rather than a structural international retail development (Moore et al., 2010). In fact, it has been noticed that luxury griffes open retail stores quite exclusively in primary locations (Hutchinson et al. 2009) and that most of the internationalization literature on retail stores openings by luxury firms is referred to the opening of flagship stores (Moore et al., 2010), a specific retail store format that from its nature, is mostly related to brand promotion than to an effective and stable retail development. In fact, retailing as international market entry strategy implies significant investment both in economic and cognitive terms (Mattila el al., 2002; Guercini and Runfola, 2010). The study of retail stores opening as an entry strategy in international markets remains an understudied field of study in the academic literature, as evidenced for example by Ilonen et al. (2011) in their study on the importance of branded retail in manufacturers' international strategy. Moreover, the authors point out that among other things, this remains a topic of interest but not yet analyzed in the case of the fashion industry. Following this reasoning, our article aims to answer to the subsequent research questions: RQ1 - What is the evolution over time of the distribution investments of luxury fashion manufacturing companies? RQ2 - Is there a difference between emerging markets and advanced markets for luxury retail store openings? RQ3 - What is the role of metropolitan areas and how does this evolve over time? Methodology and discussion We investigate these research questions in the case of Italian luxury manufacturing companies. In order to study the expansion of Italian luxury companies, we have exploited the information contained in the database that we have created expressly for the purposes of this research. The database has been compiled by examining any news contained in two specialized and highly recognized national fashion-sector publications - Fashion and Pambianco Week - regarding the opening of retail outlets in foreign countries by Italian luxury firms in the decade 2004-2013. For the purpose of this research we have considered as luxury brands those brands that are members of Altagamma, a association whose members are Italian companies that operate at the highest end of the market, and those brands that are recognized globally and by academics and empirical press as luxury brands, although not being members of Altagamma. The above process has identified 594 sales points opened by 39 Italian brands in 62 countries over the period 2004-2013. The top 10 brands for number of store openings over this period are the followings: Prada (64), Salvatore Ferragamo (59), Miu Miu (51), Ermenegildo Zegna (31), Valentino (29), Armani (26), Versace (26), Gianfranco Ferrè (25), Brioni (22), Etro (22). Hereafter we try to describe some preliminary findings regarding the three research questions advanced previously. RQ1 – What is the evolution over time of the distribution investments of luxury fashion manufacturing companies? Our analysis seems to show an evolution in this growth strategy over the period 2004-2013. In fact, if during the period 2004-2008 our analysis shows the opening of 261 single-brand outlets by the enterprises of our sample, during the period 2009-2013 the number of operations became 333 stores. This seems to highlight how, even in a period of international crisis, the retail strategy for luxury companies remained fundamental for growing abroad. The year 2008 is the year with the maximum number of stores opened by our companies (95 stores, roughly 16% of the total 594 stores opened), while the year 2004 is the one with the minimum number of stores opened, only 35 stores (roughly 6%). Moreover, each year from 2009-2011 accounts for over 70 stores. RQ2- Is there a difference between emerging markets and advanced markets for luxury retail store openings? In order to distinguish between “mature”, developed countries and “emerging” ones, we considered the first 24 countries that joined firstly the OCSE as “mature”, while all the remaining countries have been considered “emerging”. Our analysis reveals during the period analyzed a growing incidence by emerging markets compared to mature markets, given that emerging markets account for 60.9% of the openings. Moreover, in each year analyzed emerging markets overcome advanced markets for number of stores opened. However, traditional mature markets for Italian luxury (such as USA or Japan) as well as new emerging markets (such as China and Russia) are within the top destinations all over the period. If we consider only the first three markets for number of retail operations we may note some differences between the two sub-periods. In fact, during the period 2004-2008 the first three markets listed for decreasing number of operations were the USA (45 retail stores opened, 17,2% of the total number of stores), China (29 stores, 11,1% of the total) and India (19 stores, 7,3% of the total). During the period 2009-2013, China increased the number of operations, becoming the leading market with 74 stores, representing 22,2% over the total, followed by the USA (46 stores, 13,2% of the total) and United Arab Emirates (15 stores, 4,5%). The rising of China in the second period, is associated with an increasing importance of other emerging markets such as Brazil and South Korea, that in the previous period were not within the top international destinations. We should however stress that other mature markets, such as France and Japan still have key roles for Italian luxury companies. RQ3 – What is the role of metropolitan areas and how does this evolve over time? Our analysis shows that the major cities world-wide are present in our database. In total the companies in our sample have opened stores in 163 cities. Over the period 2004-2013 the top 10 cities listed for decreasing number of stores are the following: Shanghai (30), Hong Kong (28), New York (25), Moscow (24), Tokyo (22), Paris (21), Dubai (20), London (20), Los Angeles (20), Beijing (20). However, as evidenced by the data, while in the period 2004-2008, the total number of cities targeted by the companies were 83, in the following period 2009-2013 the number cities targeted became 127. This data seems to highlight how, over time, the presence of luxury firms is not only concentrated in the top cities around the world neither only in luxury streets, but affects a larger number of cities and locations. Take for example the case of the new rising Chinese cities of the II, III and IV tiers. To conclude, our research points out how retail strategy implemented by luxury manufacturing companies is one of the driving strategy for relating the company with consumers in international markets. This strategy seems to represent a relevant and widespread used strategy to enter in foreign market and to develop the brand further. Some considerations are due on the limitations inherent in the present study, which can also furnish some useful indications as to future work. The empirical evidence reported here is based on secondary research in market publications. Aside from collecting further, more up-to-date information, future research should be addressed to performing a number of enterprise case studies in order to acquire a better understanding of the phenomena at play through contacts with luxury enterprise managers with whom to share the main aspects involved in establishing sales networks in foreign countries. Moreover, the considerations advanced are based on empirical evidence drawn solely from study of the Italian luxury fashion industry. In this sense, future research should aim to check if any differences exist in retail store openings between the Italian fashion system and the luxury fashion industries of other economically mature nations (e.g., France, the UK, Japan or the USA). Although, our empirical analysis has some limitations, it seems to confirm that the retail market strategy is a key strategy to relate with consumers in international markets and to let them “experience” the brand. For manufacturing companies in the luxury field this strategy should not be considered only in terms of promotion, as typically associated with the opening of flagship stores abroad. Rather, it represents an effective retail strategy with important implications from a managerial point of view. Considering this latter point, future research should be directed towards the study of the different strategic behaviors aiming at pointing out different strategic groups within our companies, for example in terms of company size or destination markets. In general terms, future research should be directed towards the study of the link between retail stores openings and customer experience in international markets. This issue has a particular relevance in the case of the Italian fashion industry, where understanding the retail strategy of luxury companies may contribute to recognize potential bandwagon effects of other companies in this sector, such as small and medium sized companies with other positioning.

COMPETITIVE SUPPLY CHAINS: AN INSIGHT INTO THE LUXURY INDUSTRY

Simone Guercini,Annalisa Tunisini 글로벌지식마케팅경영학회 2015 Global Fashion Management Conference Vol.2015 No.06

The paper supports the idea that competition is nowadays played among supply chains rather than among companies. The competitive action has been mainly analyzed as a single actor' strategy, looking for gaining a competitive advantage over competitors (Porter, 2008). The competitive advantage is connected to distinctive resources and capabilities owned and/or controlled by the single actor and, especially, to how a company is capable to combine and connect such resources and capabilities reaching a distinctive positioning (Grant, 1991). By re-defining the most traditional view, Porter underlines how strategy has to look for uniqueness rather than to the search for being better than others in the market (Porter, 1996). Following such a view, scholars have addressed their attention to identify new sources of differential advantage, based on a at least temporary uniqueness. Such new sources mostly rely on intangible issues and on the capability to perform more efficiently and effectively market-driven processes (Day, 1994). By shifting his view from tangible to intangible issues, from products to processes, literature has focalized on the company's network relationships as fundamental sources of differential advantage (Hakansson, Snehota, 1989; Dyer, Singh, 1998). The structure and dynamics of a company's business relationships, as well as the company's relational capabilities can sensibly make the difference between one company's performance and another's in the eye of the customer. Processes of value creation and delivery capable to meet customer expectations are only in part referred to activities performed by a single supplier company. Rather, they are connected to a number of companies that interact and connect their resources and capabilities in supply chains' contexts (Christopher, 2012; Cox, Lamming 1995). The customer satisfaction (or dissatisfaction) can be addressed to a single supplier, notably the branded company that directly interfaces with the customer but it is strongly connected to how the branded company's supply chain has been able to mobilize resources, connect activities and exchange information. (Dyer, 1996; Gadde et al., 2010). In confronting and evaluating its perceptions in respect to two different brands a customer expresses his satisfaction (or not) towards the performance of two different supply chains (Hines, 2004). Taking a branded company, driving a supply chain (it is also known as strategic center or leader company), structuring, mobilizing and enabling effective and efficient business relationships with effective and efficient suppliers becomes the most important tool to gain market shares and keep customers satisfied. As network literature well explains, even if a company is a leader in a supply chain, business relationships with supplier companies can only be partially addressed and oriented, mobilized. (Ford, Hakansson, 2002). The general aim of this paper is to discuss the impact of the processes of contractual formalization in business networks on the competitiveness of the supply chains. More precisely, the paper focalizes on a new tool introduced by Italian government, named "Contratto di Rete" (Network Contract - NC)1, that can be also useful to reinforce, orient and develop efficient and effective supply chains. The NC is not simply a type of strategic business alliance as a joint venture or a consortium can be (Guercini and Woodside 2012). It is a flexible tool that companies may use and it is a legal framework within which a network of companies can experiment various opportunities to innovate and to be more competitive. The NC sustains SMEs' development and competitiveness, especially in an international context. The NC also represents a new way of response for Italian SMEs to the current economic crisis, and to the challenges posed by an increasingly globalized and competitive market. Small and medium enterprises represent a significant portion of the industry in most countries. This share is particularly relevant in the Italian reality. In Italy the weight very strong of the small business and the relative weakness of big business has recently been the focus of debate on the loss of competitiveness of the country's industrial system (Coltorti et al., 2013). Empirically, the paper studies the case of Gucci and its supply chains that have used the NC to reinforce and promote their positioning and their performance. In particular, sponsored by the Florentine brand of luxury and with the support of Confindustria Florence, three NC have been developed - P.re.Gi. , Almax and Fair – among the companies of three supply chains of small leather goods , bags and luggage . Each of the three networks includes companies that provide the complete production cycle, from cutting the skin and in one case even tanning to the final packaging of the object . The idea behind the signing of the “Contratto di rete” is come together to promote the transfer of innovation, knowledge transfer, know -how and training, but also to make economies of scale, improve access to credit, streamline costs and streamlining the supply chain, to ensure improved transparency in the flow of marginalization by the leader until the last sub-contractor. In each of the three networks, the parent company is different from Gucci that is left out of the contract. But, most interesting, Gucci will play the role of facilitator, subject to address and exchange of best practices, support and advice in the organizational, technological, financial and training issues. By studying the three NC, the paper wants to emphasize the most important issues both supporting and limiting the action of supply chains as competitive sets. Based on our preliminary study of these Network Contracts, made possible by the availability of a large secondary material and by the research conducted by the authors both on the new legislative tool leading to formalized networks and on the business networks spread since long-term in the leather industry, we formulate some propositions which can be tested as hypothesis or considered as alternatives explanations of the possible role played by the NC to support the competitiveness of companies and supply chains. The study of the Network Contract must take into account with attention to different layers it may impact and influence the competitiveness of the supply chains. At a first layer, it can be a tool of survival of present existing competitive ability and/or supporting the development of new capabilities. One aspect not mutually exclusive but complement the other. It can, however, be interesting to see logic sub-standing the formalization of existing networks and which are the objectives present in the declared intentions as well as those emerging from the observation of the behavior of the actors involved. You may recognize different levels of goal through the process of formalization. A first objective is linked to the fact that the importance of business networks makes them subject to specific policy of public policy makers. This makes the process of formalization important and useful for access policies to support networks. In this sense, a first proposition can be the following: P1. The network contract represents a tool of formalization of existing business networks that allows first to make visible, perceptible such structures and enabling policy makers to support them through appropriate policies to support their growth or survival. At a second layer, the formalization of existing networks can have organizational impacts. The recognition of a strategic center within the network, the formal creation of central coordination unit, or at least the existence of roles and shared resources can also substantially initiating organizational changes that make the network an entity able to access to larger economies and critical mass in respect to individual companies. The contractual formalization can produce effects on the roles of the individual actors involved and determine a different conduct of trials. This can allow the achievement of economies, the achievement of critical mass to trigger new initiatives, to realize innovations. Where networks emerge from declining districts the depletion of external economies can be a way to internalizing in formalized networks a part of the resources as an answer to the crisis of the external district. NC can thus support companies to benefit from the shift from external economies to internal “networks” economies In this sense, a second proposition can be the following: P2. The formalization through contracts in business networks has organizational effects that result in new processes and methods of use of the resources that can affect the operation of the business network and generate economies. At a third layer, in addition to affecting the relationship between the companies and the policy makers as well as the organizational processes in the business network, the formalization by NC can have effects on the contents of the strategy implemented by the firms involved and implemented by the whole chain. Particularly in the luxury sector competition among supply chains assumes importance in terms of exclusivity and the level of quality of the offered products. The contents of the strategy have systematically need to take account of the supply chains. This pushes systematically luxury brands (defined as actors) to search for forms of vertical control through ownership (acquisition of suppliers) and through contracts (contracts for exclusive supply). Consider the role of supply chain strategies related to issues such as: (1) ecological sustainability and social sustainability of productions from luxury brands; (2) country of origin and country of product design on which is affixed the company logo; (3) traceability and guarantees associated with the use of branded products etc. In this sense, a third proposition can be the following: P3. The formalization of contracts in business networks has effect on the strategies declared and / or emerging from the behavior of the actors, both in terms of content and dynamics in the implementation. The paper, through an in-depth analysis of the three networks connected to the Gucci’s supply chain, wants to test the hypotheses corresponding to the three propositions formulated above making a comparison between the supply networks before and after the formalization of the business relationships by the Network Contract. The paper is structured as follows: in the first section the paper emphasizes the shift from a view of competition among companies to competition among supply chains and stresses major problems emerging in supply network dynamics. It then focalizes on the NC tool and its characteristics that can support supply network dynamics. The paper thus focuses on the three networks connected to the brand Gucci. In the final section, the paper summarizes the three mail levels of impact that the NC may have on the supply chains’ competitiveness: the supportive level, the organizational level and the strategic level. A comparison between the main issues affecting supply chains competitiveness in case of their formalized or not-formalized networks structure let draw final conclusions are on the role of Network contracts as positive and negative promoter on supply chains competitiveness.

INSIGHTS INTO THE INTERFACE BETWEEN ENTREPRENEURIAL AND DIGITAL MARKETING

Simone Guercini,Matilde Milanesi,Silvia Ranfagni 글로벌지식마케팅경영학회 2018 Global Marketing Conference Vol.2018 No.07

This paper builds on issues that surround the interface between entrepreneurial and digital marketing. In particular, it proposes a conceptual framework that relates digital market knowledge, market representation and decision making in the context of entrepreneurial SMEs. Thus, the paper contributes to the understanding of how entrepreneurs deal with digital market knowledge, and how such knowledge contributes to changes in representing markets and decision making. A growing awareness of the importance of entrepreneurship and innovation to marketing, and of marketing to successful entrepreneurship, has led to attempts to combine the two disciplines as “entrepreneurial marketing”. Scholars debate on the role of marketing in the entrepreneurial process (Schindehutte et al., 2009), and consider the marketing content of the entrepreneurial role (Guercini, 2012). It is argued that entrepreneurial marketing emphasizes the adaptation of marketing to forms that are appropriate to small and medium‐sized enterprises (SMEs), even if entrepreneurial relates more in general to the marketing-entrepreneurship interface and the idea that marketing and entrepreneurship are fundamentally intertwined and necessary to the other. Marketing and the entrepreneurship take place in a context in which information technologies, data communication and data processing technologies are tools to manipulate, organize, transmit, and store information in digital form. More specifically, one of the major changes undergone by traditional marketing is determined by the emergence of digital marketing, which provides several tools and metrics, such as web analytics, for decision makers. However, it is yet not sufficiently clear how entrepreneurs deal with this type of knowledge emerging in a digital context, and how they use it in their decision making. The paper proposes a cross-case analysis based on in-depth interviews with entrepreneurs from SMEs in the fashion industry, a relevant empirical context that has experienced, before others, the implementation of digital marketing strategies. The analysis suggests the existence of different entrepreneurial profiles based on the approach adopted in dealing with digital market knowledge, as well as the existence of different types of relationships between entrepreneurs and digital market knowledge and alternative consequences in terms of decision-making processes.

MAKE OR BUY DECISIONS AS A CONSEQUENCE OF THE INTERNATIONAL EXPANSION OF LUXURY FASHION RETAIL OPERATIONS.

Simone Guercini,Matilde Milanesi 글로벌지식마케팅경영학회 2015 Global Fashion Management Conference Vol.2015 No.06

The paper examines the impact of international expansion of retail operations on the choice of performing internally or outsourcing some strategic activities in order to cope with the demands of retail outlets in domestic and foreign markets, providing a case analysis of Italian luxury fashion companies.

MATCHING BUSINESS MODELS THROUGH ADAPTATION IN BUSINESS RELATIONSHIPS: HOW DO SUPPLIERS COPE WITH FAST FASHION?

Simone Guercini,Andrea Runfola 글로벌지식마케팅경영학회 2018 Global Marketing Conference Vol.2018 No.07

This paper investigates the adaptation of suppliers’ business models to the changing customers relationships, with a focus on the fashion industry. The analysis of business models represents an understudied topic in business to business marketing research (Ehret, Kashyap and Wirtz, 2013; La Rocca and Snehota, 2017). In this regard, the paper tries to propose an original contribution by addressing the issue of how suppliers adapt their business models to cope with the needs of their fast fashion customers. It is well known that the fast fashion formula has represented an innovative business model which has generated huge changes within the fashion industry (Barnes and Lea-Greenwood, 2006). While, the business models of global brands, such as those of Zara or H&M, have been deeply studied, minor attention has been given to the business models of the suppliers that interact with this kind of players. Consequently, the paper addresses a research gap that regards the suppliers' business model changes due to the interaction with fast fashion clients. The paper has an exploratory nature. Methodologically, it proposes two qualitative case studies of suppliers in interaction with fast fashion suppliers, pointing out the main features of the adaptation of their business models in the relationship with these clients. The paper contributes to theory and managerial practice pointing out some drivers of change for suppliers with respect to the most evident characteristics of the business model of the buyers. It describes these drivers and proposes some relevant evidences to support the study of business models in business markets.

Heuristics in decision-making by exporting textiles SMEs

Simone Guercini,Runfola Andrea 한국마케팅과학회 2021 Journal of Global Fashion Marketing Vol.12 No.1

This article deals with the use of heuristics in the decision-making process of entrepreneurial exporting Small and Medium-Sized Enterprises (SMEs) in business-to-business settings. It specifically considers the textile industry. Heuristics can be defined as “simple rules” for cognition and action. The article points out the presence of a research gap in the literature on the decision-making of exporting SMEs and deals with the following research question: What heuristics are used in exporting decisions by SMEs in business-tobusiness markets? Empirically, it discusses the findings of seven case studies of Italian exporting textiles SMEs in business-tobusiness markets. The results reveal the widespread use of heuristics and formulate propositions about their features. Findings show that heuristics in exporting SMEs in the textile industry are perceived as effective tools for export decisions, corresponding to personal beliefs of the single decision-maker, intentionally built through experience, generalizable to different export markets, and time tested.

CONVIVIALITY IN ENTREPRENEURIAL COMMUNITIES AND BUSINESS NETWORKS IN THE FASHION INDUSTRY: AN EXPLORATORY RESEARCH PROJECT

Simone Guercini,Silvia Ranfagni 글로벌지식마케팅경영학회 2015 Global Fashion Management Conference Vol.2015 No.06

Conviviality is an interdisciplinary concept and a key phenomenon in the entrepreneurial communities. Entrepreneurial communities are social units that share values, experiences, emotions, rituals and traditions. They give rise to personal contact networks that are sets of formal or informal individual relationships. Conviviality means sharing, openness and participation; in this sense, it can be a tool to foster, animate and amalgamate a community. Thus, it can increase social relations that stably bind individuals and thus, becomes a source of business relations. Drawing from literature analysis and a case of a fashion entrepreneurial community, we propose to investigate how conviviality create an integration between social and business networks.

Developing fashion retail operations to growth in emerging markets

Simone Guercini,Andrea Runfola 한국마케팅과학회 2019 Journal of Global Fashion Marketing Vol.10 No.2

This paper looks at the relations between the rise of emerging markets and the store openings of marketers from advanced countries. It focuses on the retail operations of Italian fashion brands that have opened sales points in order to gain entry into foreign markets. The paper presents an analysis of an expressly developed database of 2,141 store openings by 311 Italian fashion brands in 322 cities in 82 countries over the period 2006–2015. The analysis highlights a shift of brands stores openings from the developed countries toward emerging markets and discusses the impact of such trend and its relations with the heterogeneity of the firms and markets involved. Some propositions are then formulated regarding the consequences for brand marketers in the developed nations of this ongoing shift of wealth towards the emerging countries.