Abstract
Despite the widespread adoption of electronic coupons as a promotion tool for attracting customers and increasing operating revenue, there are few empirical studies that focus on the impact of promotion design under smart retail circumstance. How do consumers handle dazzling coupon information? Which coupon distribution method best encourages consumers to redeem coupons? To answer those questions, we collected promotion data from 24 Chinese chain retailers for this paper and matched that design data to the corresponding retail performance data. Our unique data set allows us to reveal the relationship between promotion design and retail operating performance. Our analyses show that promotion depth and width both have significant positive effects on coupon redemption. Unlike quick response (QR) code coupons, location-based coupons, feed ad coupons and payment gift coupons all exert negative effects on coupon redemption. Among retailers, specialty stores have a lower coupon redemption ratio than supermarkets, while the coupon redemption ratio of convenience stores shows no difference from that of supermarkets. In addition, retailer reputation has a positive effect on coupon redemption. We also investigate the moderating effect of retail format and retailer reputation for further discussion.
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Data availability
The datasets generated and analyzed during the current study are not publicly available due the fact that they contain confidential business information but are available from the corresponding author on reasonable request.
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Acknowledgements
This study is supported in part by the National Natural Science Foundation of China (72172145, 71932002), the Natural Sciences and Engineering Research Council of Canada Discovery (RGPIN-2019-07050), and the Beijing Natural Science Foundation (9212020).
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Appendices
Appendix A: Use Ln_red as dependent variable and use zero-inflated negative binominal regression
Variables | (1) | (2) | (3) | (4) | (5) | (6) | (7) |
|---|---|---|---|---|---|---|---|
Ln_red | Ln_red | Ln_red | Ln_red | Ln_red | Ln_red | Redemption | |
PDepth | 1.787*** | 1.760*** | 1.707*** | 1.792*** | 1.659*** | 1.641*** | 1.267*** |
(0.305) | (0.286) | (0.291) | (0.300) | (0.303) | (0.306) | (0.283) | |
Pack | – 2.454*** | – 2.805*** | – 2.666*** | – 2.465*** | – 2.510*** | – 2.499*** | – 2.649*** |
(0.453) | (0.466) | (0.451) | (0.479) | (0.490) | (0.490) | (0.446) | |
Single | – 2.111*** | – 2.271*** | – 2.158*** | – 2.128*** | – 2.088*** | – 2.076*** | – 1.424*** |
(0.398) | (0.395) | (0.397) | (0.398) | (0.407) | (0.405) | (0.294) | |
Location_based | – 1.261*** | – 1.263*** | – 1.265*** | – 1.318*** | – 1.291*** | – 1.277*** | – 2.312*** |
(0.289) | (0.304) | (0.298) | (0.307) | (0.305) | (0.309) | (0.320) | |
Feed_ads | – 2.131*** | – 2.204*** | – 2.077*** | – 2.130*** | – 2.099*** | – 2.099*** | – 1.994*** |
(0.429) | (0.419) | (0.427) | (0.423) | (0.436) | (0.438) | (0.314) | |
Payment_gift | 0.071 | 0.042 | 0.001 | 0.149 | 0.090 | 0.092 | – 0.617*** |
(0.245) | (0.245) | (0.246) | (0.245) | (0.246) | (0.246) | (0.218) | |
Specialty | – 1.551*** | – 1.632*** | – 1.969*** | – 1.592*** | – 1.751*** | – 1.801*** | – 1.850*** |
(0.346) | (0.387) | (0.367) | (0.385) | (0.389) | (0.400) | (0.397) | |
Convenience | 0.488* | 0.198 | 0.560** | 0.184 | 0.357 | 0.406 | – 0.257 |
(0.269) | (0.279) | (0.276) | (0.279) | (0.289) | (0.323) | (0.291) | |
Leading | 0.996*** | 0.996*** | 0.736*** | 1.039*** | 0.706** | 0.732** | 1.293*** |
(0.253) | (0.251) | (0.276) | (0.257) | (0.284) | (0.292) | (0.323) | |
Receive | 2.67e-05*** | 2.72e-05*** | 2.59e-05*** | 2.69e-05*** | 2.63e-05*** | 2.62e-05*** | 3.05e-05*** |
(2.65e-06) | (2.71e-06) | (2.68e-06) | (2.75e-06) | (2.84e-06) | (2.84e-06) | (3.26e-06) | |
Holiday | – 0.386** | – 0.474** | – 0.492*** | – 0.488*** | – 0.516*** | ||
(0.182) | (0.184) | (0.185) | (0.184) | (0.190) | |||
Lasting_days | – 0.027** | – 0.025* | – 0.026** | – 0.027** | – 0.010 | ||
(0.013) | (0.013) | (0.013) | (0.013) | (0.011) | |||
Culture | 0.237 | 0.327 | – 0.324 | – 0.266 | 0.534** | ||
(0.263) | (0.268) | (0.343) | (0.360) | (0.254) | |||
Coastal | – 0.437** | – 0.442** | – 0.927*** | – 0.937*** | 0.027 | ||
(0.200) | (0.201) | (0.298) | (0.303) | (0.326) | |||
Population | – 0.0001** | – 6.79e-05 | – 3.11e-05 | – 9.48e-05 | |||
(5.40e-05) | (5.81e-05) | (0.0001) | (8.50e-05) | ||||
Old_rate | 0.138** | 0.204*** | 0.190** | 0.094*** | |||
(0.061) | (0.074) | (0.080) | (0.034) | ||||
Gender_rate | 0.069 | 0.172*** | 0.156** | 0.043*** | |||
(0.048) | (0.063) | (0.072) | (0.007) | ||||
Imbalance | 0.0001 | – 0.0001 | |||||
(0.0003) | (0.0002) | ||||||
Constant | 4.510*** | 4.655*** | – 4.440 | 4.732*** | – 15.930** | – 13.850 | – 16.230 |
(0.435) | (0.447) | (5.678) | (0.467) | (7.385) | (8.783) | (552.200) | |
Observations | 789 | 789 | 789 | 789 | 789 | 789 | 789 |
\(R^2\) | 0.364 | 0.364 | 0.364 | 0.371 | 0.377 | 0.377 | |
Vuong test | z = -0.780 | ||||||
Pr > z = 0.7821 |
Appendix B: Main results with control variables of year 2020
Variables | (1) | (2) | (3) | (4) | (5) | (6) | (7) |
|---|---|---|---|---|---|---|---|
Redemption | Redemption | Redemption | Redemption | Redemption | Redemption | Redemption | |
PDepth | 1.275*** | 1.391*** | 1.077*** | 1.314*** | 1.334*** | 1.219*** | 1.417*** |
(0.227) | (0.225) | (0.230) | (0.227) | (0.234) | (0.238) | (0.251) | |
Pack | – 2.584*** | – 2.604*** | – 2.615*** | – 2.593*** | – 2.626*** | – 2.613*** | – 2.505*** |
(0.337) | (0.334) | (0.340) | (0.322) | (0.348) | (0.352) | (0.359) | |
Single | – 1.423*** | – 1.483*** | – 1.379*** | – 1.509*** | – 1.431*** | – 1.370*** | – 1.310*** |
(0.240) | (0.232) | (0.222) | (0.237) | (0.240) | (0.227) | (0.237) | |
Location_based | – 2.435*** | – 2.444*** | – 2.412*** | – 2.593*** | – 2.272*** | – 2.290*** | – 2.287*** |
(0.276) | (0.287) | (0.285) | (0.278) | (0.291) | (0.292) | (0.294) | |
Feed_ads | – 2.134*** | – 2.166*** | – 2.012*** | – 2.231*** | – 2.037*** | – 1.927*** | – 1.781*** |
(0.273) | (0.272) | (0.259) | (0.275) | (0.279) | (0.266) | (0.282) | |
Payment_gift | – 0.822*** | – 0.845*** | – 0.805*** | – 0.995*** | – 0.589*** | – 0.593*** | – 0.546*** |
(0.207) | (0.187) | (0.190) | (0.199) | (0.195) | (0.191) | (0.189) | |
Specialty | – 1.354*** | – 1.844*** | – 2.177*** | – 1.245*** | – 1.738*** | – 2.196*** | – 2.218*** |
(0.257) | (0.312) | (0.380) | (0.328) | (0.302) | (0.424) | (0.425) | |
Convenience | – 0.153 | – 0.272 | – 0.210 | – 0.276 | – 0.308 | – 0.163 | – 0.227 |
(0.253) | (0.284) | (0.254) | (0.251) | (0.267) | (0.280) | (0.276) | |
Leading | 1.557*** | 1.565*** | 1.264*** | 1.641*** | 1.549*** | 1.210*** | 0.977*** |
(0.258) | (0.325) | (0.326) | (0.295) | (0.286) | (0.341) | (0.347) | |
Receive | 3.25e-05*** | 3.14e-05*** | 2.99e-05*** | 3.32e-05*** | 3.11e-05*** | 2.98e-05*** | 3.06e-05*** |
(4.13e-06) | (3.99e-06) | (3.91e-06) | (4.33e-06) | (3.73e-06) | (3.68e-06) | (3.83e-06) | |
Holiday | – 0.531*** | – 0.541*** | – 0.505*** | – 0.481*** | |||
(0.170) | (0.174) | (0.176) | (0.175) | ||||
Lasting_days | – 0.012 | – 0.014 | – 0.009 | – 0.008 | |||
(0.012) | (0.013) | (0.013) | (0.013) | ||||
Culture2020 | 0.736*** | 0.716*** | 0.514 | – 0.834 | |||
(0.252) | (0.241) | (0.507) | (0.699) | ||||
Coastal | 0.261 | 0.028 | 0.171 | 0.307 | |||
(0.218) | (0.201) | (0.317) | (0.284) | ||||
Pop2020 | – 5.08e-05 | – 6.79e-05 | – 0.0003** | ||||
(3.61e-05) | (5.49e-05) | (0.0001) | |||||
Old_rate2020 | 0.198*** | 0.143** | 0.367*** | ||||
(0.046) | (0.064) | (0.129) | |||||
Gender_rate2020 | 0.122*** | 0.063 | 0.433** | ||||
(0.041) | (0.079) | (0.181) | |||||
Imbalance2020 | – 8.25e-05 | – 0.0007** | |||||
(7.79e-05) | (0.0003) | ||||||
Constant | 6.242*** | 5.764*** | – 9.980** | 5.822*** | 5.969*** | – 2.869 | – 46.610** |
(0.383) | (0.399) | (4.843) | (0.554) | (0.426) | (9.083) | (21.410) | |
\(Pseudo ~R^2\) | 0.039 | 0.038 | 0.039 | 0.038 | 0.040 | 0.040 | 0.041 |
\(Wald~\chi^2\) | 738.320*** | 716.070*** | 747.610*** | 729.640*** | 728.600*** | 764.410*** | 774.060*** |
Observations | 789 | 789 | 789 | 789 | 789 | 789 | 789 |
Appendix C: Impact of promotion design, using redemption rate and control variables of year 2020
Variables | (1) | (2) | (3) | (4) | (5) | (6) | (7) |
|---|---|---|---|---|---|---|---|
RedRate | RedRate | RedRate | RedRate | RedRate | RedRate | RedRate | |
PDepth | 0.424*** | 0.436*** | 0.428*** | 0.438*** | 0.431*** | 0.452*** | 0.488*** |
(0.136) | (0.135) | (0.145) | (0.138) | (0.134) | (0.142) | (0.142) | |
Pack | – 0.989*** | – 1.147*** | – 1.167*** | – 1.141*** | – 0.965*** | – 0.972*** | – 0.918*** |
(0.146) | (0.139) | (0.135) | (0.140) | (0.153) | (0.154) | (0.164) | |
Single | – 0.846*** | – 0.929*** | – 0.936*** | – 0.928*** | – 0.840*** | – 0.849*** | – 0.822*** |
(0.136) | (0.128) | (0.129) | (0.128) | (0.137) | (0.137) | (0.140) | |
Location_based | – 2.057*** | – 2.055*** | – 2.043*** | – 2.059*** | – 2.077*** | – 2.075*** | – 2.098*** |
(0.087) | (0.093) | (0.092) | (0.092) | (0.092) | (0.091) | (0.093) | |
Feed_ads | – 1.956*** | – 1.964*** | – 1.971*** | – 1.950*** | – 1.963*** | – 1.985*** | – 1.945*** |
(0.143) | (0.139) | (0.145) | (0.140) | (0.143) | (0.149) | (0.153) | |
Payment_gift | – 0.721*** | – 0.773*** | – 0.773*** | – 0.760*** | – 0.723*** | – 0.731*** | – 0.715*** |
(0.098) | (0.093) | (0.099) | (0.099) | (0.095) | (0.096) | (0.098) | |
Specialty | – 0.521*** | – 0.525*** | – 0.483*** | – 0.404** | – 0.571*** | – 0.551*** | – 0.545*** |
(0.147) | (0.171) | (0.187) | (0.163) | (0.171) | (0.198) | (0.203) | |
Convenience | 0.272** | 0.302** | 0.308*** | 0.282*** | 0.288** | 0.287** | 0.267** |
(0.109) | (0.128) | (0.113) | (0.108) | (0.124) | (0.138) | (0.135) | |
Leading | 0.452*** | 0.426** | 0.415** | 0.398** | 0.450*** | 0.466** | 0.338 |
(0.174) | (0.179) | (0.190) | (0.178) | (0.173) | (0.199) | (0.220) | |
Holiday | – 0.132 | – 0.127 | – 0.133 | – 0.116 | |||
(0.084) | (0.086) | (0.087) | (0.088) | ||||
Lasting_days | – 0.028*** | – 0.028*** | – 0.028*** | – 0.028*** | |||
(0.009) | (0.009) | (0.009) | (0.009) | ||||
Culture2020 | 0.077 | 0.076 | 0.063 | – 0.229 | |||
(0.114) | (0.117) | (0.194) | (0.212) | ||||
Coastal | 0.053 | 0.068 | 0.056 | 0.121 | |||
(0.098) | (0.102) | (0.115) | (0.127) | ||||
Pop2020 | 9.20e-06 | 1.20e-05 | – 6.58e-05 | ||||
(1.73e-05) | (1.94e-05) | (4.49e-05) | |||||
Old_rate2020 | 7.51e-05 | – 0.012 | 0.044 | ||||
(0.023) | (0.032) | (0.040) | |||||
Gender_rate2020 | 0.007 | 0.005 | 0.087* | ||||
(0.023) | (0.035) | (0.047) | |||||
Imbalance2020 | – 4.81e-05 | – 0.0002* | |||||
(4.53e-05) | (9.77e-05) | ||||||
Constant | – 0.150 | – 0.367* | – 1.064 | – 0.496** | – 0.218 | – 0.603 | – 10.380* |
(0.196) | (0.199) | (2.691) | (0.241) | (0.198) | (4.021) | (5.560) | |
\(Pseudo ~R^2\) | 0.250 | 0.239 | 0.238 | 0.239 | 0.250 | 0.250 | 0.251 |
Observations | 789 | 789 | 789 | 789 | 789 | 789 | 789 |
Appendix D: Impact of promotion design, adding independent variables separately, using redemption and control variables of year 2020
(1) | (2) | (3) | (4) | (5) | |
|---|---|---|---|---|---|
VARIABLES | Redemption | Redemption | Redemption | Redemption | Redemption |
PDepth | 1.341*** | ||||
(0.322) | |||||
Pack | – 3.817*** | ||||
(0.254) | |||||
Single | – 0.536*** | ||||
(0.193) | |||||
Location_based | – 3.081*** | ||||
(0.255) | |||||
Feed_ads | – 0.755*** | ||||
(0.258) | |||||
Payment_gift | – 0.524** | ||||
(0.223) | |||||
Specialty | – 3.554*** | ||||
(0.423) | |||||
Convenience | 0.068 | ||||
(0.298) | |||||
Leading | 2.312*** | ||||
(0.357) | |||||
Receive | 2.76e-05*** | 3.37e-05*** | 3.22e-05*** | 2.39e-05*** | 2.24e-05*** |
(5.34e-06) | (4.23e-06) | (5.01e-06) | (4.33e-06) | (4.60e-06) | |
Holiday | – 0.648*** | – 0.730*** | – 0.615*** | – 0.540** | – 0.660*** |
(0.241) | (0.183) | (0.217) | (0.230) | (0.225) | |
Lasting_days | – 0.028* | – 0.014 | – 0.025* | – 0.038** | – 0.033** |
(0.016) | (0.014) | (0.014) | (0.016) | (0.016) | |
Culture2020 | – 1.901*** | – 1.300*** | – 1.205** | – 2.226*** | 0.185 |
(0.482) | (0.495) | (0.577) | (0.604) | (0.484) | |
Coastal | – 0.0692 | – 1.130*** | – 0.246 | 0.281 | – 0.701*** |
(0.332) | (0.240) | (0.238) | (0.340) | (0.253) | |
Pop2020 | – 0.0005*** | – 0.0002** | – 0.0002** | – 0.0006*** | 4.85e-05 |
(0.0001) | (0.0001) | (9.53e-05) | (0.0001) | (0.0001) | |
Old_rate2020 | 0.460*** | 0.321*** | 0.303*** | 0.720*** | 0.049 |
(0.095) | (0.089) | (0.088) | (0.122) | (0.087) | |
Gender_rate2020 | 0.620*** | 0.364*** | 0.331*** | 0.844*** | 0.055 |
(0.127) | (0.119) | (0.128) | (0.158) | (0.105) | |
Imbalance2020 | – 0.001*** | – 0.0007*** | – 0.0006*** | – 0.0009*** | – 6.24e-05 |
(0.0002) | (0.0002) | (0.0002) | (0.0002) | (0.0002) | |
Constant | – 69.270*** | – 38.370*** | – 34.410** | – 95.120*** | – 2.776 |
(15.230) | (14.220) | (15.180) | (18.860) | (12.460) | |
\(Pseudo ~R^2\) | 0.017 | 0.025 | 0.028 | 0.022 | 0.019 |
\(Wald~\chi^2\) | 137.710*** | 366.650*** | 247.210*** | 222.520*** | 215.780*** |
Observations | 789 | 789 | 789 | 789 | 789 |
Appendix E: Impact of promotion design, adding independent variables separately, using redemption rate and control variables of year 2020
(1) | (2) | (3) | (4) | (5) | |
|---|---|---|---|---|---|
VARIABLES | RedRate | RedRate | RedRate | RedRate | RedRate |
PDepth | 0.410*** | ||||
(0.150) | |||||
Pack | – 1.596*** | ||||
(0.110) | |||||
Single | 0.206** | ||||
(0.097) | |||||
Location_based | – 2.180*** | ||||
(0.081) | |||||
Feed_ads | – 1.268*** | ||||
(0.101) | |||||
Payment_gift | – 0.644*** | ||||
(0.095) | |||||
Specialty | – 0.641** | ||||
(0.249) | |||||
Convenience | 0.451*** | ||||
(0.122) | |||||
Leading | 0.514*** | ||||
(0.170) | |||||
Holiday | – 0.166* | – 0.153 | – 0.111 | – 0.120 | – 0.140 |
(0.095) | (0.095) | (0.093) | (0.095) | (0.094) | |
Lasting_days | – 0.027*** | – 0.024*** | – 0.030*** | – 0.032*** | – 0.030*** |
(0.007) | (0.008) | (0.009) | (0.007) | (0.007) | |
Culture2020 | – 0.766*** | – 0.757*** | – 0.537*** | – 0.734*** | – 0.468 |
(0.279) | (0.237) | (0.179) | (0.269) | (0.293) | |
Coastal | – 0.126 | – 0.280** | – 0.075 | 0.064 | – 0.213* |
(0.122) | (0.118) | (0.114) | (0.142) | (0.117) | |
Pop2020 | – 0.0002*** | – 0.0002*** | – 0.0001*** | – 0.0002*** | – 0.0001** |
(4.72e-05) | (4.58e-05) | (3.49e-05) | (5.77e-05) | (5.22e-05) | |
Old_rate2020 | 0.089** | 0.098*** | 0.094*** | 0.128** | 0.036 |
(0.040) | (0.036) | (0.025) | (0.051) | (0.044) | |
Gender_rate2020 | 0.144** | 0.117** | 0.141*** | 0.160** | 0.046 |
(0.061) | (0.052) | (0.038) | (0.069) | (0.067) | |
Imbalance2020 | – 0.0005*** | – 0.0004*** | – 0.0004*** | – 0.0003*** | – 0.0003*** |
(0.0001) | (0.0001) | (8.34e-05) | (0.0001) | (0.0001) | |
Constant | – 18.410** | – 15.440** | – 17.340*** | – 20.410** | – 7.094 |
(7.186) | (6.118) | (4.472) | (8.148) | (7.759) | |
\(Pseudo ~R^2\) | 0.060 | 0.099 | 0.216 | 0.072 | 0.061 |
Observations | 789 | 789 | 789 | 789 | 789 |
Appendix F: Impact of promotion design, using subsamples and control variables of year 2020
Variables | Holiday = N | Receive > = Receive(median) | ||
|---|---|---|---|---|
(1) | (2) | (3) | (4) | |
Redemption | RedRate | Redemption | RedRate | |
PDepth | 1.619*** | 0.453*** | 1.686*** | 0.652*** |
(0.305) | (0.161) | (0.310) | (0.174) | |
Pack | – 1.519*** | – 0.831*** | – 1.702*** | – 0.839*** |
(0.342) | (0.166) | (0.338) | (0.233) | |
Single | – 1.220*** | – 0.705*** | – 1.287*** | – 0.659*** |
(0.229) | (0.138) | (0.287) | (0.197) | |
Location_based | – 2.621*** | – 2.147*** | – 4.016*** | – 2.649*** |
(0.293) | (0.101) | (0.276) | (0.153) | |
Feed_ads | – 1.900*** | – 1.907*** | – 2.916*** | – 2.042*** |
(0.292) | (0.159) | (0.318) | (0.199) | |
Payment_gift | – 0.744*** | – 0.662*** | – 2.080*** | – 1.811*** |
(0.213) | (0.114) | (0.231) | (0.159) | |
Specialty | – 1.775*** | – 0.595*** | – 1.493*** | – 0.689*** |
(0.445) | (0.215) | (0.522) | (0.235) | |
Convenience | – 0.512* | 0.171 | – 0.564 | – 0.502*** |
(0.295) | (0.144) | (0.346) | (0.170) | |
Leading | 1.844*** | 0.335 | 2.155*** | 0.488*** |
(0.399) | (0.241) | (0.375) | (0.148) | |
Receive | 2.62e-05*** | 1.41e-05*** | ||
(4.16e-06) | (2.52e-06) | |||
Holiday | 0.214 | 0.086 | ||
(0.195) | (0.145) | |||
Lasting_days | – 0.056*** | – 0.037*** | 0.004 | 0.024*** |
(0.013) | (0.010) | (0.013) | (0.009) | |
Culture2020 | 0.326 | – 0.088 | 1.344* | 0.325 |
(0.781) | (0.218) | (0.728) | (0.312) | |
Coastal | 0.399 | 0.217* | 0.464 | 0.189 |
(0.353) | (0.132) | (0.408) | (0.189) | |
Pop2020 | – 0.0002 | – 6.46e-05 | – 4.20e-05 | – 0.0002*** |
(0.0001) | (4.54e-05) | (9.55e-05) | (4.93e-05) | |
Old_rate2020 | 0.224* | 0.037 | 0.052 | 0.052 |
(0.131) | (0.041) | (0.067) | (0.037) | |
Gender_rate2020 | 0.195 | 0.090* | – 0.208* | 0.042 |
(0.193) | (0.048) | (0.125) | (0.057) | |
Imbalance2020 | – 0.0004 | – 0.0002** | 0.0002 | – 0.0004*** |
(0.0003) | (9.88e-05) | (0.0003) | (0.0001) | |
Constant | – 19.220 | – 10.640* | 28.090* | – 6.214 |
(22.780) | (5.642) | (14.460) | (6.659) | |
\(Pseudo ~R^2\) | 0.043 | 0.250 | 0.057 | 0.351 |
\(Wald~ \chi^2\) | 757.200*** | 962.340*** | 928.140*** | 701.950*** |
Observations | 626 | 626 | 395 | 395 |
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Tian, X., Tang, J. & Zhou, Y. Impact of promotion design on retail operating performance: Evidence from Chinese Chain retailers. Electron Commer Res (2024). https://doi.org/10.1007/s10660-024-09805-w
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DOI: https://doi.org/10.1007/s10660-024-09805-w