Cases

Why Stanford’s parking fees could backfire and fail to reduce driving

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At Stanford University, parking is segregated based on how much you pay. Drivers can purchase Permit A for $133 per month or Permit C for $38 per month. Each permit dictates where you are allowed to park. Permit A holders must park in Permit A-designated areas, while Permit C holders are restricted to Permit C zones.

This tiered system ensures that those who pay more get closer and more convenient parking, while lower-paying permit holders have to park farther away. For example, in the five-story outdoor Via Ortega Garage, the lower two floors are reserved for Permit A holders, while the upper three floors are designated for Permit C holders.

The same pricing structure applies to indoor, underground parking facilities like Roble Field Garage. Permit C holders should drive farther down to find an available spot than permit A holders.

Permit A parking lots are often partially empty, while Permit C lots are crowded. Those who pay more not only get better locations but also enjoy less competition for spaces. The message is clear: convenience comes at a price.

While searching for an empty space in the Permit C parking lot, a thought crossed my mind: Why not pay $100 more to enjoy convenience?

Then, it struck me that I had become so absorbed in choosing between two permits that I completely ignored a third, unspoken option which I once enjoyed: riding a bicycle. The very act of choosing between two permits kept me from questioning whether I needed to drive at all.

We are born to choose. Once presented with options, we become fixated on making a choice, failing to recognize that the choice itself may be artificially constructed. Differentiated parking fees may subtly reinforce car dependency instead of encouraging biking.

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Reference

Leotti, L. A., Iyengar, S. S., & Ochsner, K. N. (2010). Born to choose: The origins and value of the need for control. Trends in Cognitive Sciences, 14(10), 457-463.

Belief in one’s ability to exert control over the environment and to produce desired results is essential for an individual’s well-being. It has repeatedly been argued that perception of control is not only desirable, but is also probably a psychological and biological necessity. In this article, we review the literature supporting this claim and present evidence of a biological basis for the need for control and for choice—that is, the means by which we exercise control over the environment. Converging evidence from animal research, clinical studies, and neuroimaging suggests that the need for control is a biological imperative for survival, and a corticostriatal network is implicated as the neural substrate of this adaptive behavior.

Cases

CloudTec for ON Running shoes: Intuitive naming helps sell innovation

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In the crowded world of running shoes, big names like Nike and Adidas are everywhere. But even with these giants, ON Running is making a mark.

It started in 2010 in Switzerland. One of the three founders, Olivier Bernhard, wanted a new kind of running shoe. He tried something different by attaching pieces of garden hose to shoe soles. This simple idea led to CloudTec, making runners feel like they are running on clouds.

One possible reason why ON Running is successful is its smart naming of this technology. The word “Cloud” signals softness, while “Tec” adds a sense of innovation. Without knowing the details of the technology, consumers can easily grasp that these shoes provide a unique running experience: soft landings followed by explosive take-offs.

Consumers often rely on technology features that are intuitively understandable. One of my favorite examples is Quattro, Audi’s all-wheel-drive system. Even for those unfamiliar with car mechanics, the name “Quattro” suggests something powerful, stable, and reliable.

A well-branded feature name gives consumers a reason to believe in the technology, even without technical knowledge.

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Reference

Gunasti, K., & Ross Jr, W. T. (2010). How and when alphanumeric brand names affect consumer preferences. Journal of Marketing Research, 47(6), 1177-1192.

This research develops a taxonomy of alphanumeric brand names (ABs) based on the alignment between the brand names and their links to products and attributes. Five empirical studies reveal that ABs have systematic effects on consumers’ product choices, moderated by consumers’ need for cognition, the availability of product attribute information, and the taxonomic category of the AB. In an identical choice set, the choice share of a product option whose brand name takes a higher versus lower numeric portion (e.g., X-200 versus X-100) increases, and it is preferred more even when it is objectively inferior to other choice alternatives. Consumers with low need for cognition use “the higher, the better” heuristic to select options labeled with ABs and choose brands with higher numeric portions. Consumers with high need for cognition process ABs more systematically and make inferences about attribute values based on brand name–attribute correlations. The effects of ABs on consumer preferences are prevalent for most technical products, even when consumers do not know the product category or meanings of attributes.

Cases

Golf carts at Stanford: Exciting and unexpected

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When I first saw golf carts at Stanford, I was very surprised. It felt like I was not at a university but on a golf course. Seeing these small vehicles moving around campus made me excited. They looked fun, and the atmosphere felt more relaxed.

Later, I learned that some of these carts are designated for students who hurt their ankles. Stanford has a special service called DisGo Cart Service to help people who have difficulty walking. They are also used for many purposes, such as helping people with disabilities, supporting medical staff, and moving faculty members quickly.

Other universities might use golf carts for similar purposes. However, because Stanford’s campus is very large, these carts are common, making them feel like a normal part of life here.

New students may feel this effect when they first arrive, but after some time, they get used to it. Even now, when I see these carts, I feel like I am in an exciting place.

When golf carts line up in parking spots, they remind me of a group of cats sitting quietly. Their backside is cute; they look like the back of cats because the small roofs and rounded shapes create a soft, compact appearance.

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Reference

Fredrickson, B. L. (2001). The role of positive emotions in positive psychology: The broaden-and-build theory of positive emotions. American psychologist, 56(3), 218.

In this article, the author describes a new theoretical perspective on positive emotions and situates this in perspective within the emerging field of positive psychology. The broaden-and-build theory posits that experience of positive emotions broaden people’s momentary thought–action repertoires, which in turn serves to build their enduring personal resources, ranging from physical and intellectual resources to social and psychological resources. Preliminary empirical evidence supporting the broaden-and-build theory is reviewed, and open empirical questions that remain to be tested are identified. The theory and findings suggest that the capacity to experience positive emotions may be a fundamental human strength central to the study of human flourishing.

Cases

Why California students prefer Dutch Bros over Starbuck

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Dutch Bros Coffee is growing faster than Starbucks and becoming one of the most successful coffee chains in the U.S. It is now the fourth-largest coffee brand and continues to open new locations.

One reason for this success is its business model. While Starbucks spends heavily on store remodeling, Dutch Bros focuses on small drive-thru locations. This strategy allows them to expand quickly at lower cost.

However, fast service alone is not enough. Dutch Bros succeeds because of its superior customer experience. Unlike Starbucks, which can feel transactional, Dutch Bros creates a warm and personal experience. Their “broistas” (baristas) often remember customers’ names and favorite drinks, making visit feel like a conversation rather than a purchase. The company’s motto, “We may sell coffee, but we’re in the relationship business,” reflects its focus on customer connections.

Many students also enjoy the secret menu and customizeable drinks, such as Golden Eagle and Rebel Energy.

Dutch Bros understands what Gen Z wants, that is, a fast and friendly experience. Rather than focusing solely on coffee taste, it focuses on the experience of coffee buyers. Customer experience matters.

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Reference

Lemon, K. N., & Verhoef, P. C. (2016). Understanding customer experience throughout the customer journey. Journal of marketing, 80(6), 69-96.

Understanding customer experience and the customer journey over time is critical for firms. Customers now interact with firms through myriad touch points in multiple channels and media, and customer experiences are more social in nature. These changes require firms to integrate multiple business functions, and even external partners, in creating and delivering positive customer experiences. In this article, the authors aim to develop a stronger understanding of customer experience and the customer journey in this era of increasingly complex customer behavior. To achieve this goal, they examine existing definitions and conceptualizations of customer experience as a construct and provide a historical perspective of the roots of customer experience within marketing. Next, they attempt to bring together what is currently known about customer experience, customer journeys, and customer experience management. Finally, they identify critical areas for future research on this important topic.

Cases

How urinal heights in California made me kinder

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Men’s restrooms in California are interesting. Among multiple urinals, one is almost always placed significantly lower than the others.

At Stanford University’s Y2E2 building, the engineering department’s restroom features a lowered urinal.

D.School, home to Stanford’s designers and creativity thinkers, also incorporates this principle.

In the Mountain View Public Library, the pattern continues.

Even at the Santa Cruz amusement park, this feature can be observed.

Interestingly, California’s attention to height differences goes beyond urinals.

At the Stanford Redwood City’s gym, drinking fountains are installed at two different heights.

Similarly, two hand dryers vary their heights in the Mountain View Public Library.

The Santa Cruz amusement park includes one sink with a footstep among a row of basins.

These height variations comply with accessibility codes to accommodate a broader range of users, including children and individuals with disabilities. They are specified in the California Building Code (CBC), Chapter 11B.

According to Section 11B-605.2 of the CBC, urinals must be either stall-type or wall-hung, with the rim positioned no higher than 17 inches (432 mm) above the finished floor. Additionally, urinals are required to have a minimum depth of 13½ inches (343 mm), measured from the outer face of the urinal rim to the back of the fixture.

In all the cities I have visited including Toronto, Seoul, and Copenhagen, I have never encountered men’s restrooms with urinals at varying heights. It was only after being exposed to this design in California that I became aware of how some individuals might struggle with standard urinals.

Certainly, ideal height for urinals is arguable. However, regardless of the practical effectiveness of the height variations, California’s effort to accommodating different people is psychologically effective. This enforced inclusivity encourages me to be more considerate of others including children or individuals in wheelchairs. Design can reveal aspects of the world we overlook.

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Reference

Patrick, V. M., & Hollenbeck, C. R. (2021). Designing for all: Consumer response to inclusive design. Journal of consumer psychology, 31(2), 360-381.

Inclusive design considers the needs and capabilities of the whole population to decrease the actual or perceived mismatch between the user and the design object. We review the inclusive design literature across multiple disciplines to conceptualize inclusive design, identify who should be included in the inclusive design process, present an overview of the evolution of design approaches, and summarize best practices on how organizations can facilitate inclusive design. We posit three levels of inclusive design based on the diminishing degree of mismatch between the user and the design object: providing accessibility (Level 1), engaging participation by creating equitable experiences (Level 2), and facilitating empowered success via flow experiences (Level 3). We introduce our Design, Appraisal, Response, Experience (DARE) framework to explain the complex cognitive appraisals and emotional responses that each of these three levels of inclusive design elicits and underscores the notion that inclusive design works best when it’s not intended for a specific need, but rather benefits anyone who uses it. We conclude with a call for future research in this rich and important domain of investigation that seeks both to understand consumer response to inclusive design and to incorporate inclusive design into brand strategy, practice, and policy.

Cases

Why Americans stick to Keurig while the world prefers Nespresso

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After arriving in California, I was struck by a coffee pod brand completely unfamiliar to me: Keurig. Despite owning a Nespresso coffee machine at the office and a De Longhi espresso machine at home, I was surprised that I had never seen or heard about Keurig before.

In California, Keurig machines are everywhere. The brand holds 41% of the single-serve coffee machine market in the United States and is estimated to have three times the sales of Nespresso nationwide.

However, Nespresso is the leading coffee capsule brand in most other markets. In Korea, it dominates the coffee machine market with a 52% share.

The biggest advantage of Keurig is that many coffee companies produce pods or capsules compatible with its machines. Brands like Starbucks, Peet’s Coffee, and Dunkin offer options for Keurig users. Additionally, Keurig machines and K-Cups are generally more affordable than Nespresso machines and capsules.

However, Nespresso has gaining market share in the United States. Since introducing the VertuoLine system, which brews full-size coffees in addition to espresso, Nespresso increased its US market share to 14.4% in 2023 up from 11% in 2022. During the same period, Keurig’s share declined from 56.2% to 53.1%. The competition between the two brands is intense and dynamic.

Does this mean cultural differences explain their dominance in different markets? Do Californians value variety and quantity, while Koreans appreciate premium experiences?

Cultural differences are unlikely to be reasons. The real explanation is much simpler: people rarely switch from the brand they first encounter. Californians often start with Keurig because it is the most accessible option, while Koreans are introduced to Nespresso through advertising. Once preferences are formed, they tend to stick.

Each brand’s popularity may not be driven by taste or luxury but by who enters the market first. This is why Uber holds an advantage over Lyft in ride-hailing services and why Waymo continues to thrive while Cruise failed in the self-driving car industry.

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Reference

Carpenter, G. S., & Nakamoto, K. (1989). Consumer Preference Formation and Pioneering Advantage. Journal of Marketing Research, 26(3), 285-298.

Examined whether pioneering advantage could arise from the process by which consumers learn about brands and form their preferences (PFs). In 2 experiments with 103 MBA students, hypothetical emerging markets were constructed, varying the order of brand (computer software packages or down quilts) entry across Ss and the types of competitors that subsequently entered the market. Analysis showed that PFs were influenced by the order of brand entry. Moreover, the PF formation process produced a PF structure that made a pioneer’s market share largely invulnerable to competitors, even if switching costs were minimal and brands could reposition.

Cases

Why do some stores attract me like magnets?

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It is hard to find souvenirs in California that are not available in Korea. Because of this, I do not usually feel drawn to specific stores. However, Jupiter & Main at Half Moon Bay caught my attention. This store carefully selects items made from natural materials and hand-crafted designs. The collection includes leather goods and handmade decor.

I could not pass by another store, Makers Market at Santana Row in San Jose. This store also features handcrafted goods made from natural materials. The range includes leather, wood, and textiles, all showcasing expert craftsmanship.

I am attracted to these stores likely because of a psychological association between the material of a product and the perception of its authenticity. For example, when a material like leather is local, I may assume that the finished product is also local. While this perception is not always accurate, it becomes stronger when handmade or hand-crafted elements are involved. This association makes handmade crafts using leather or natural materials particularly appealing as souvenirs. As someone who values authenticity, these products feel local, and stores featuring them create local experience.

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Reference

Beverland, M. B., & Farrelly, F. J. (2010). The quest for authenticity in consumption: Consumers’ purposive choice of authentic cues to shape experienced outcomes. Journal of consumer research, 36(5), 838-856.

Drawing from image-elicited depth interviews, we investigate whether consumers pursue the consumption of authentic objects with specific personal goals in mind. We find that consumers are motivated to focus on those particular cues in objects that for them convey authenticity (what is genuine, real, and/or true) and that this decision-making process is driven by a desire to draw different identity benefits (control, connection, virtue) from authentic objects. Our interpretive analysis elaborates contributions to theorizing related to consumer agency in seeking authentic consumption experience. We provide cultural explanations for the desire to assert the authentic self in these particular ways.

Cases

How my misconception shaped my view of Blue Bottle

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At Santana Row in San Jose, the Blue Bottle Coffee store captures attention with its European-inspired design. A shaded patio under a huge tree, cozy seating, and a fountain create the ambiance of a European plaza.

What struck me, however, was my assumption that Blue Bottle was a Japanese brand due to its minimalist design and precise brewing methods. To me, this coffee brand felt synonymous with Balmuda, a Japanese Electronics brand that prioritizes simplicity.

However, the truth surprises me. Blue Bottle is neither Japanese nor European. It was founded in Oakland, California, in 2002. While it embraces Japanese style, the brand’s actual roots are Californian. In 2017, Nestlé acquired a majority stake, expanding its reach to over 100 locations worldwide, including Japan, South Korea, and China.

Despite its true origins, Blue Bottle seems to benefit from the misconception of being Japanese. Although research shows that authenticity of origin enhances value, my observation flips this insight: when a brand’s origin is incorrectly perceived but aligns with its narrative, it can still elevates value. For Blue Bottle, the misperception of Japanese origins strengthens its image of precision and sophistication. Authenticity may not matter as much as perception.

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Reference

Newman, George E., and Ravi Dhar (2014), “Authenticity Is Contagious: Brand Essence and the Original Source of Production,” Journal of Marketing Research, 51(3), 371–386.

It is well established that differences in manufacturing location can affect consumer preferences through lay inferences about production quality. In this article, the authors take a different approach to this topic by demonstrating how beliefs in contagion (the notion that objects may acquire a special aura or “essence” from their past) influence perceptions of authenticity for everyday consumer products and brands. Specifically, they find that due to a belief in contagion, products from a company’s original manufacturing location are viewed as containing the essence of the brand. In turn, this belief in transferred essence leads consumers to view products from the original factory as more authentic and valuable than identical products made elsewhere.

Cases

Why $39 feels worth it for a fake experience in Las Vegas

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I recently visited Las Vegas to attend CES 2025. While many exhibitions were exciting, it was a gondola ride at the Venetian Hotel that kept me thinking afterward.

I was surprised to see people willingly pay premium prices for fabricated experiences. The ride costs $39 for a 10-minute journey along an indoor canal under a painted sky. A private gondola for two costs $156! Why would anyone pay so much for something artificial?

The answer probably lies in the power of social status. These fabricated experiences are designed to be visually stunning. They create shareable moments for platforms like Tiktok or Instagram. I saw many visitors took gondola selfies under the “Venetian sky.” Authenticity may matter less than the emotions people gain from the experience.

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Reference 1

Pine, B. J., & Gilmore, J. H. (1998). Welcome to the experience economy. Harvard Business Review, 76(4), 97-105.

How do economies change? The entire history of economic progress can be recapitulated in the four-stage evolution of the birthday cake. As a vestige of the agrarian economy, mothers made birthday cakes from scratch, mixing farm commodities (flour, sugar, butter, and eggs) that together cost mere dimes. As the goods-based industrial economy advanced, moms paid a dollar or two to Betty Crocker for premixed ingredients. Later, when the service economy took hold, busy parents ordered cakes from the bakery or grocery store, which, at $10 or $15, cost ten times as much as the packaged ingredients. Now, in the time-starved 1990s, parents neither make the birthday cake nor even throw the party. Instead, they spend $100 or more to “outsource” the entire event to Chuck E. Cheese’s, the Discovery Zone, the Mining Company, or some other business that stages a memorable event for the kids—and often throws in the cake for free. Welcome to the emerging experience economy.

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Reference 2

Choi, B., & Joo, J. (2021). Authentic Information on the Back Label of Wine Bottle. Asia Marketing Journal, 23(3), 13–26.

This paper investigates whether including authentic information on the back labels of wine bottles enhances consumers’ confidence and purchase intentions about wine; it also assesses the moderating role of involvement and knowledge about wine. We conducted two experimental studies. Study 1 generated three findings. First, when the back label had authentic information, subjects showed higher confidence levels. Second, this effect was hold for subjects with low levels of involvement. Finally, we did not observe this effect for subjects with high levels of involvement. Study 2 extended study 1’s findings and identified the moderated mediation effect of confidence. The findings highlight the important impact on wine choice of authentic information. However, the findings also suggest that authentic information may not be sufficient to attract people with high levels of involvement and knowledge. This study’s findings provide wine producers with practical marketing insights.

Cases

Why California bus drivers prioritize kindness over time

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Public transportation in California is not as polished as in Seoul. Buses are noisier, roads are bumpier, and fares are higher. Yet, I witnessed an impressive moment that highlights a difference: how a passenger with disabilities was treated.

On a bus in San Jose, a wheelchair user boarded. The driver stopped the bus, left his seat, and assisted the passenger in fastening the seatbelt securely. The process took over five minutes. In Seoul, such a scene would be rare.

This difference likely stems from policies and norms rather than individual kindness. In California, transportation policies seem to allow drivers to prioritize care over punctuality. Moreover, passengers appear to accept delays, fostering an environment where helping others is encouraged and expected. Similar to California’s policies and norms, I hope Korea implement measures that force drivers and citizens to empathize with and care for those in need.

Jaewoo Joo | design thinking, behavioral economics, field experiment, customer experience