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Why customers hold the key to a company’s true valuation
When determining a fair valuation for a company—especially in anticipation of an initial public offering (IPO)—investors often rely heavily on “top down” approaches focusing primarily on traditional financial measures to do so. But what if this approach doesn’t paint the full picture? Daniel McCarthy, assistant professor of marketing at Emory’s Goizueta Business School, is building the case that augmenting traditional data sources with customer behavior data gives investors a more accurate company valuation. For the past several years, McCarthy and Peter Fader, professor of marketing at the Wharton School of the University of Pennsylvania, have worked to refine a customer-driven investment methodology they created. “Customer-based corporate valuation (CBCV) simply brings more focus to how individual customer behavior drives the top line,” they explained in “How to Value a Company by Analyzing Its Customers,” an article published in the Harvard Business Review (HBR) earlier this year. “This approach is driving a meaningful shift away from the common but dangerous mindset of ‘growth at all costs,’ towards revenue durability and unit economics—and bringing a much higher degree of precision, accountability, and diagnostic value to the new loyalty economy.” Fader, McCarthy’s PhD advisor while he was at Wharton, had done some of the seminal work on forecasting customer shopping/purchasing behaviors. This helped build baseline expertise for how one could go about the customer-level modeling. McCarthy recognized that this behavioral modeling could be put to good use in a financial setting, if done the right way. “There was this untapped source of intellectual property that’s been accumulating within marketing over the last 30 years,” McCarthy said. While other academics have done some conceptual work in the area, none, McCarthy noted, had done so in a way that was consistent with how financial professionals go about performing corporate valuation. McCarthy and Fader merged these well-validated customer-level models with standard corporate valuation methods, then put their resulting valuation tool head-to-head with alternative approaches. They found that their CBCV model subsequently outperformed. A full article on this subject is attached, within it, you will find key CBCV highlights such as: Using unit economics to more accurately predict revenue forecasts Gaining access to the right data The CBCV model is also good for managers and for customers Working to have publicly traded companies adopt CBCV McCarthy’s work on the CBCV methodology has earned him a number of awards, including the MSI Alden G. Clayton, American Statistical Association, INFORMS, and the Shankar-Spiegel dissertation awards. If you are a journalist covering this topic or if you want to learn more about this work or customer-based corporate valuation – then let our experts help. Daniel McCarthy is an Assistant Professor of Marketing at Emory University's Goizueta School of Business where his research specialty is the application of leading-edge statistical methodology to contemporary empirical marketing problems. If you are looking to contact Daniel – simply click on his icon now to arrange an interview today.
MEDIA RELEASE: Drivers asked to stay alert and slow down as students prepare to return to school
COVID-19 has changed the way we do many things and, the return to school is no different. This year, children are being encouraged to walk and bike to school to support social distancing. In some parts of Ontario, the start of school is even being staggered, and some children may be doing a combination of in-person and distance learning. In addition, many children will be using masks that may obstruct their line of sight. For these reasons, CAA South Central Ontario (CAA SCO) is reminding everyone to take extra caution this year while travelling through school zones. “As students prepare to reunite with friends and classmates after a six-month hiatus, many might forget to take the extra precautions needed to stay safe. This means there is an even bigger responsibility to watch for children travelling to and from school,” says Raymond Chan, manager of government relations for CAA SCO. Keeping our kids and neighbourhoods safe is a shared responsibility. That’s why this year, we are providing FREE “Slow Down Please” lawn signs to anyone living in South Central Ontario. When well-placed, these signs aim to make roads safer for children and those living in the community. Remember to check local bylaws before installing signs on private property. Anyone can pick up a maximum of two signs at any CAA Store, while quantities last. Drivers can also use the following CAA tips to ensure they are staying safe in school zones. Make eye contact with children: With the excitement of back to school, anticipate that children may not easily see or hear your moving vehicle. Make eye contact with passing pedestrians and cyclists. Reduce traffic by walking: Incorporate a short walk into your commute to school. CAA encourages parents to park a block away and walk to school, if possible, to reduce congestion and make school zones safer. Slow down: Know the speed limit in your neighbourhood’s school zones and respect them. Watch for more school buses: Always stop for the buses’ flashing lights and wait for children to get safely on or off. Stay alert and watch for children or parents crossing the road when the bus moves on. Choose a safe spot to drop off and pick up your children from school: Follow your school’s rules and don’t park illegally, it can put your child’s safety at risk. Instead, use the designated drop off areas or consider a spot a bit farther away from school that is easily accessible and safe. The above tips are crucial in maintaining a safe school zone. According to a CAA poll, nearly 25 per cent of drivers reported witnessing a near miss or collision in a school zone, more than half of which involved a child. The poll also revealed 70 per cent of Canadians said they have witnessed someone speeding in a school zone. CAA also supports safety in school zones through the CAA School Safety Patrol program. CAA designed this program to protect, educate, and empower elementary school children on safe road-crossing practices. Our Ontario Road Safety Resource is a toolkit for teachers to educate Ontario youth about road safety.
Georgia Southern University – is thinking BIG when it comes to entrepreneurs and small business
Through the CARES Act and the U.S. Department of Commerce, Georgia Southern University’s Business Innovation Group (BIG) has received $300,000 in grant funding to expand its services to the region in an effort to help communities and businesses respond to and recover from the economic impact of the coronavirus pandemic. “This will really allow us to help businesses and entrepreneurs throughout the entire state ideally get access to the skills, knowledge and services that Georgia Southern has to offer,” said Dominique Halaby, DPA, director of BIG. Over the next two years, BIG will use these funds to expand their services through the Georgia Enterprise Network for Innovation and Entrepreneurship (GENIE). “We’re hoping that we can demonstrate to budding entrepreneurs and small business owners that Georgia Southern can help them develop and grow,” Halaby said. “We are hopeful that in two years’ time people are going to have a heightened aerial view of awareness for Georgia Southern and our Business Innovation Group services, but more importantly, that they are going to get the type of resources to be able to launch the business that they’ve always wanted to launch.” Halaby said offering these resources to the region is important for economic growth. “Any time that we have an ability to do something, we have a responsibility to do it,” Halaby said. “The needs of our community are great. Our ability to service those needs by connecting those with the resources on our campus and with the skills that we have fostered within BIG puts us in a very unique position. This way, we are able to provide services to help as many entrepreneurs and to help as many people looking for jobs as we possibly can.” BIG will also use part of the grant funding to work with Georgia Southern faculty to strengthen patent and licensing activity. “We’re working with our intellectual property committee and through the University to let faculty know that if they’ve got a concept, that BIG can help them flesh that out. We can work with them to do an analysis to see the marketability for their concept and determine if it’s patentable or licensable,” Halaby said. If you’re a journalist looking to know more about how Georgia Southern University is assisting regional businesses or its Business Innovation Group (BIG) – then let our experts help with your coverage. Dominique Halaby, DPA, is the Director of the Business Innovation Group (BIG) at Georgia Southern University. In 2015, BIG was recognized as a Gold Award Winner in Entrepreneurship by the International Economic Development Council. Simply click on his icon now to arrange an interview today.
As Canadians continue to stay home during this pandemic, many cars are sitting idle for long stretches of time. Maintaining your car is important whether it’s parked for a long time or in regular use. “Dead batteries, rusty brakes and flat tires can be worrisome leaving a car parked for weeks on end,” says Kaitlynn Furse, director, corporate communications, CAA South Central Ontario (CAA SCO). ”Car owners should put measures in place to avoid unexpected mechanical issues, much like a snowbird would, if cars are sitting idle in the driveway for long periods of time.” CAA SCO car maintenance checklist: Gas up. If your vehicle is going to be idle for more than 30 days, fill the tank up to the brim. This will help prevent moisture from building up in the fuel tank. Add a fuel stabilizer to the tank when full (stabilizers have a shelf life of three months and may help keep the fuel lines and engine from corroding). Protect the battery. It will eventually lose its charge if it isn’t driven at least once every few weeks. A trickle charger or battery tender with an automatic shut-off feature will keep the battery in good condition when the vehicle isn’t being driven. Inflate the tires. You can get flat spots on your tires from the vehicle sitting in one position. If your car is going to be parked and not moving add extra 10 PSI to the tire pressure when it is sitting idle. When you are ready to drive it remove that extra 10 PSI. Clean it well. Protect your paint job by removing acidic bird droppings, corrosive salt or dirt off the paint and take it a step further, polish or wax the exterior. Another item to consider is to check your tires to minimize the likelihood of wheel separation. A wheel separation is the unintended release of any active wheel from a moving vehicle. These incidents occur most commonly during the months of May through August after motorists switch from winter to all season tires. “Wheel separation can be very dangerous, causing, property damage, injuries and even fatalities,” says Furse. “If you are changing your tires at home, please make sure you go the extra step to make sure they are installed properly.” If you are unsure about any part of the installation of a wheel on your vehicle, be sure to take the vehicle to a qualified shop for its seasonal tire change. CAA has compiled a list of Approved Auto Repair Service facilities that have been vetted for quality service standards. Please check with your local facility as business hours for AARS locations may vary during the pandemic.
Are Home Prices in Peril? FAU Expert Says Coronavirus Stimulus May Hold the Key
The United States housing market faces its biggest threat in more than a decade, and whether home prices can withstand the new coronavirus pandemic largely depends on an effective stimulus package, said Ken H. Johnson, Ph.D., a real estate economist in Florida Atlantic University’s College of Business. U.S. President Donald Trump recently signed a historic $2 trillion stimulus to boost a battered U.S. economy, and getting the aid exactly right is the key to avoiding the first sustained setback to home prices since the end of the housing boom in 2006, according to Johnson. “If the stimulus package ends up being more than we need, this will almost certainly trigger a non-trivial amount of inflation in the economy, which will increase mortgage rates, which, in turn, will place downward pressure on housing prices,” Johnson said. “If the stimulus is not sufficient enough to hold down unemployment and it increases the likelihood of mortgage default, mortgage rates will rise and put downward pressure on housing prices. Only if the stimulus is just right will increasing inflation and higher unemployment be held in check.” Fixed rates for 30-year mortgages rose from 3.29 percent on March 5 to 3.65 percent on March 19, before moving down to 3.5 percent last week as the stimulus gained momentum. The higher rates are an indication that investors are factoring in inflation and the higher likelihood of default, though the recent downward trend suggests that it was the threat of rising default probabilities that was having the bigger impact on mortgage rates, according to Johnson. Since bottoming in March 2012, U.S. home prices rose 61 percent over the next seven and a half years, according to the S&P/Case-Shiller 20-City Composite Home Price Index. The nation’s housing market rebounded from a devastating downturn when investors started renovating and reselling properties after buying them at deep discounts. The market has been robust ever since, but Zillow Group recently suspended its home-buying program as a result of the pandemic and how it may affect the housing market. The move means Zillow is worried that housing prices are at risk, according to Johnson. If mortgage rates were to climb from 3.5 percent to 5 percent, it would result in a 43 percent increase in the interest portion of a housing payment, dramatically reducing the purchasing power for consumers. “Only time will tell here,” Johnson said. “We are in uncharted waters, making it difficult to tell when and if we got the stimulus package right.” If you are a journalist covering how real estate and property values are being impacted by the COVID-19 pandemic – then let our experts help. Ken Johnson is the associate dean and Investments Limited professor in the College of Business at Florida Atlantic University. Ken is available to speak to media about this topic – simply click on his icon to arrange an interview and time.
Soundgarden, Chris Cornell's Widow Spar Over Royalties and Recordings
It's been a "Black Hole Sun" set of months for the members of Soundgarden, who are in a legal fight with the widow of the band's former lead singer, Chris Cornell, who died in 2017. Cornell's wife, Vicky, filed suit against the band in December 2019, claiming that her husband's estate was owed "hundreds of thousands of dollars" in royalties for unreleased recordings prior to his death. Now, the band has filed a motion to dismiss the lawsuit. Intellectual property expert and law professor Michael Risch says it's an interesting decision on the band's part. "The allegations in the lawsuit are heavily fact-bound, as are the defenses," Prof. Risch says. "A motion to dismiss assumes that all the facts in the complaint are true, but the band's motion asserts that the facts are false." He says that band members usually always work things out. When you see lawsuits for copyright or other reasons, it's usually always heirs that are involved.
Interested in the Ethics of EdTech Apps? Let our Experts Help with Your Coverage
There’s been a lot of talk lately about EdTech apps. There’s a long list of benefits and advantages for students looking to succeed in these modern and digital times. However, with anything app-related – user privacy and what’s being done with all of your data that’s collected always comes to the forefront of the conversation. EdTech apps are a billion-dollar industry, and recently the experts from the University of Mary Washington were asked their opinions on the industry, the apps and privacy. Jesse Stommel, senior lecturer of Digital Studies at the University of Mary Washington, said that EdTech providers had a responsibility to do more than just legally protect themselves with terms and conditions. “The onus has to be on the tech companies themselves to educate the users about data security and data monetisation…say ‘here’s why I’m collecting it, here’s what I hope to do with it, here’s why it should matter to you’,” he said. For Dr. Stommel there was also still a danger when technologies were adopted widely across campuses and every student or lecturer was required to use them. “When certain companies become universal, staff and students don’t have a way to say ‘I won’t use it because I don’t want them to have my data’,” he said. The fact that certain products had become so widely adopted, such as plagiarism tracking software Turnitin, was another reason to be cautious about data protection, he said. Turnitin, which was sold last year for $1.8 billion (£1.4 billion), has been accused of monetising students’ intellectual property, since it works by checking submitted papers against an ever-growing database of previously submitted essays and detecting any similarities. “Companies can start off small and they say ‘we will be good stewards of this data, we’re small, we talk to each other,’ but then that company achieves more and more success and it doesn’t necessarily have the standards in place to maintain that,” said Dr. Stommel, speaking generally. “Then what happens when they are bought out? What are the ethics of the company that has purchased them? What happens to the student data then?” Dr. Stommel said that the most “moral” thing to do was for companies to collect as little data as possible but admitted “no company is approaching it in that way”. January 14 - TimesHigherEducation.com Are you a journalist covering how EdTech is now becoming a regular part of modern-day higher education? Then let our experts help with your stories. Jesse Stommel is a senior lecturer of Digital Studies at the University of Mary Washington and is an expert in faculty development, digital education and modern learning. He is available to speak with media regarding EdTech apps – simply click on his icon to arrange an interview.
It was a train running full speed and showed no signs of stopping – but America’s economy hit a bump last week and it sent a lot of people from Wall Street and beyond into a panic. The 800-point drop in the Dow Jones seemed to be the first sign of another severe recession. But before everyone cashes out, experts from Western Governors University are hoping we take a look back through the ages before rushing to worry. “What does history teach us? Even before the Great Depression of the 1930s, Nicolai Kondratieff discovered that the capitalist economy, going back to the 18th century was characterized by waves, or business cycles,” says Dr. Rashmi Prasad, Dean and Academic Vice President of Western Governors University's College of Business. “The Federal Reserve, under leadership of Ben Bernanke, claimed that while the business cycle had not been repealed, a ‘Great Moderation’ had emerged in the world post-1982. Independent central banking and the rise of the service economy were among the reasons cited. In a great irony of history, Bernanke was front and center as Chairman of the Federal Reserve during the ‘Great Recession’ of 2008-2009. Business cycles seem to be inevitable for capitalist economies. Will we return to the Great Moderation of 1982-2007, or are we in a new period of regular Great Recessions? Central Banks stabilize and soften the down-cycles of recessions, but the price of managing the Great Recession of 2008-09 has been the dramatic expansion of central bank balance sheets–no new investment cycles–property or finance often leads to recession.” So, where do we stand and what can we expect in the short-term? Prasad adds this perspective: “Conventional economic thinking indicated inflation by now, which may have added to interest rates and constrained the amount of debt that was sustainable. Rapidly rising interest rates posed the risk of a deep and extended downturn. If interest rates can be managed and kept low, then the next down-cycle could be shallowed and prolonged as monetary policy has little scope and fiscal deficits are already very high. Risks for a major downturn exist in extremely high debt levels and central bank balance sheets, but still may be a decade or two away, awaiting triggers that we cannot yet predict.” Are you a journalist covering the economy and do you need expert perspective and opinion for your stories? That’s where Western Governor’s University can help. Dr. Rashmi Prasad is Dean and Academic Vice President of Western Governors University's College of Business. He is an expert in the fields of economic and financial data and business analytics. Dr. Prasad is available to speak with media regarding the state of America’s economy – simply click on his icon to arrange an interview.
Expert perspective on a trade war with China and how it could impact a Trump presidency
Trade negotiations between the United States and China have continued to deteriorate over the last few weeks. In efforts to pressure the Chinese to make reforms to trade-related issues such as forced technology transfer and intellectual property rights, the United States has raised tariffs on nearly all Chinese exports. While there is a consensus among experts that these trade issues harm U.S. producers and must be dealt with, there is not universal agreement that a trade war is the best way to make it happen. Who will feel the effects? It is apparent that both consumers and producers in the U.S. will feel the effects of the trade war. Producers will not be able to absorb the increased costs from the raising tariffs and will need to pass them along to consumers. Consumers will begin to see the prices increase on a host of retail goods, such as clothing and apparel, toys, and home goods. Partners replaced? In addition, as the Chinese retaliate with increased tariffs on U.S. exports, such as agricultural goods, producers from other countries with lower tariffs are stepping in to take the place of the U.S. exporters. For example, Brazilian soybean producers are more than happy to sell their product to China at a lower cost. Once lost, it may be difficult for U.S. farmers to regain these important Chinese markets. A political price to pay? It appears that the effects of the trade war may hit the Trump administrations base, in agricultural and manufacturing regions, disproportionately. However, the administration may see the trade war as beneficial to Trump’s 2020 reelection campaign, as Trump is being perceived as being tough with the Chinese and holding them accountable to unfair trade practices. That appears to resonate with his base. However, it remains to be seen how long his base will continue to support this approach as both producers and consumers continue to feel the economic pinch of the growing trade war with China. There’s a lot to know about the short and long-term impacts of a trade war with China and that’s where or experts can help. Matt has taught business and marketing courses at Saint Mary’s University of Minnesota since 2008. Prior to Saint Mary’s, he worked in both the banking and the non-profit sectors, most recently with a non-governmental organization (NGO) with operations in more than a dozen countries. Matt is an expert in political and economic development and is available to speak with media. Simply click on his icon to arrange an interview.
Watch your step…snake season is in full swing! Let our experts help with your questions!
In Georgia there are sure signs of spring - flowers are in bloom…and snakes are back in the grass. Now before you shriek or shirk away at the sound or sign of a snake, it is important to know that snakes play and important and vital role in the local ecosystem. They’re essentially nature’s pest control - keeping rats, mice, moles and other rodents at bay. In fact, seeing a snake is usually a sign of good environmental health for your garden, property or local environment. And now for the less than good news. Some snakes in Georgia are dangerous. In fact, there are six different venomous snakes slithering around the state. And it’s not just in the forests and countryside, copperheads are all part of the metropolitan urban landscape too. So, what precautions do people need to take? What are the simple do’s and don’ts if you encounter a snake? Are there easy ways to identify dangerous and non-dangerous snakes? And – this season seems to be producing a much more pronounced snake population– why is that? There are a lot of questions to be asked – and that’s where our experts can help. Lance McBrayer from Georgia Southern University is an expert in organismal ecology and snakes. He’s happy to talk with media - simply click on his icon to arrange an interview.
