Understanding Consumer Reactions to Assortment Unavailability

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eduction occurs, and the type of store that reduces its assortment. Furthermore, retailers may wonder if the short-term effects of assortment reductions differ from their long-term effects. With these three essays, as presented in Chapters 2, 3 and 4, we hope to solve, at least partly, the puzzle of assortment reduction effects. 5.1.1 Summary of Chapter 2 In the first study, we focus on measuring consumers’ reactions to out-of-stock events for the consumers’ preferred brand, which can be considered a temporary assortment unavailability. Furthermore, we test a conceptual model that may explain some of the consumer reactions observed. We selected eight product groups for which we measured consumer reactions to stock- outs: four utilitarian product groups (detergent, milk, margarine, and eggs) and four hedonic product groups (beer, salty snacks, cigarettes, and cola). We used a survey to interview 749 grocery shoppers at 13 different supermarkets. The main consumer reactions observed were (1) brand switching (34%), (2) postponement of purchase (27%), (3) store switching (19%), and (4) item switching (e.g., switch within the brand) (18%). Whereas brand and item switching may have neutral effects on category sales, store switching and postponement decrease the retailer’s category sales and might even harm sales in related categories, especially in the case of store switching We also researched the antecedents of stock-out reactions. The brand equity of the brand that is out of stock, the hedonic level of the product category, the ability to stockpile the product, the number of brands within the category, and the impulse level of purchases of the product are important antecedents for several reactions. For example, consumers tend to switch stores more easily if a high-equity brand is out of stock than if a low-equity brand is. Note that, in many cases, high-equity brands are also large market share brands, which might as much as double the impact of a stock-out of a high-equity brand. Furthermore, consumers are more brand loyal (e.g., lower brand switching intentions) in product categories that have a high hedonic level, such as cola, beer, or cigarettes. In these categories, retailers should be cautious about delisting even low-equity brands. 5.1.2 Summary of Chapter 3 For the second essay, we conducted two separate studies to research the impact of a brand delisting. A single brand delisting within a category sometimes occurs, for example, when a 119
etailer boycotts a brand. Due to the growth of hard discounters like Aldi and Lidl and the lower margins caused by price erosion (e.g., price war in the Netherlands since 2003, rollback of prices in the United Kingdom since 2000), service retailers have put pressure on manufacturers to improve their buying conditions. In some cases, this pressure can even lead to a temporary or permanent brand boycott. For example, in the Netherlands, market leader Albert Heijn delisted the wine category market leader J.P. Chenet because the manufacturer did not want to improve its buying conditions. Similarly, buying organization Superunie boycotted the brands Fanta and Sprite for a while to put pressure on their parent company Coca-Cola. A brand delisting also might occur if a retailer decides to delist a weak performing brand or changes the role of the product group. In the latter case, a retailer might decide to reduce the product category assortment by one or more brands. In the first study, we used a laboratory experiment to measure the effects of the brand equity of the delisted brand, the assortment size, and the assortment structure on assortment evaluations and store-switching intentions. We apply the study to the beer category and find, in line with Chapter 2, that the equity level of the brand that is delisted is strongly correlated with assortment evaluations (negative) and store-switching intentions (positive). Furthermore, we conclude that the assortment size and the percentage of high-equity brands within the product category assortment lower the negative effects of a brand delisting. In the second study, we conducted a survey to measure store-switching and complaining intentions. We also developed and tested a conceptual model with a variety of antecedents to find factors related to those intentions. We selected ten product groups to measure consumer reactions: five utilitarian product groups (detergent, margarine, rice, toilet paper, and frozen vegetables) and five hedonic product groups (beer, cigarettes, cola, sauces, and coffee). Using a survey to interview 1,213 grocery shoppers in 16 stores, which we classified as either service (four Albert Heijn and four Super de Boer stores) or price (four Edah and four C1000 stores) oriented, we find that brand equity and product type (e.g., hedonic level) are both important variables. The equity level of the delisted brand and the hedonic level of the category are both positively related to store-switching and complaining intentions. Furthermore, the concentration level (positive), the number of brands (positive), and the percentage of high-equity brands (negative) are all related to store-switching and complaining intentions. Both retailers and manufacturers can use these results to assess their risks in situations in which a boycott is a possible outcome of negotiations between the retailer and a manufacturer. 120
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LAURENS SLOOT Understanding Consume
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UNDERSTANDING CONSUMER REACTIONS TO
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PREFACE (IN DUTCH) Begin 2001 schre
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TABLE OF CONTENTS Preface (in Dutch
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3.7 Study 2 74 3.8 Hypotheses 74 3.
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CHAPTER 1: INTRODUCTION AND OVERVIE
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Most supply chain-oriented reductio
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400 square meters) are disappearing
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more. However, Aldi is known to be
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antecedents, such as the brand equi
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of assortment reduction responses a
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assortment benefits and assortment
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2.1 Introduction Out-of-stock (OOS)
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other explanatory studies, we study
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Studies that apply exploratory desi
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Table 2.2: Methodological overview
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Situation-related variables. Situat
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As noted, consumers generally prefe
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2.3.3 The interaction of hedonic le
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For example, supermarkets are usual
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were selected for further analyses.
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example, a key utilitarian benefit
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The mathematical formulation of the
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Table 2.6: Correlation matrix depen
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correlation between the hedonic lev
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2.6 Discussion In this study, we in
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Following the literature on promoti
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consider this finding when they att
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Appendix 2A: Overview and definitio
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CHAPTER 3 UNDERSTANDING THE IMPACT
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the Dutch food retailer Edah delist
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FMI (1993) conducts natural experim
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customers no longer or less frequen
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extent, comparable to the tendency
Page 70 and 71: Figure 3.1: Graphical display of as
Page 72 and 73: consumers evaluate assortments that
Page 74 and 75: Figure 3.3: Interaction effect of a
Page 76 and 77: SSI (H1). We expect that the brand
Page 78 and 79: 3.8.4 Store-related antecedents Fin
Page 80 and 81: among the 10 specified product grou
Page 82 and 83: Retail assortment-related anteceden
Page 84 and 85: Table 3.4: Average, standard deviat
Page 86 and 87: 3.10.2 Store switching intentions W
Page 88 and 89: effects indicated in Study 1 (β =
Page 90 and 91: 3.12 Managerial implications Retail
Page 92 and 93: Appendix 3A: Overview and definitio
Page 94 and 95: 4.1 Introduction Since the early 19
Page 96 and 97: changes in assortment perceptions (
Page 98 and 99: Negative sales effects may occur be
Page 100 and 101: therefore might question the existe
Page 102 and 103: Table 4.2: Overview of separate ana
Page 104 and 105: analogously. The resulting complete
Page 106 and 107: changes in the price level do not i
Page 108 and 109: Table 4.4: Estimated parameters for
Page 110 and 111: Table 4.5: Estimated parameters for
Page 112 and 113: infrequently in the sample stores a
Page 114 and 115: Measurement. Following Hoch, Bradlo
Page 116 and 117: 4.7 Discussion In this collaborativ
Page 118 and 119: into consequences at the customer l
Page 122 and 123: Manufacturers in hedonic product gr
Page 124 and 125: 2. When retailers set priorities fo
Page 126 and 127: References Aaker, David A. (1991),
Page 128 and 129: Broniarczyk, Susan M. and Wayne D.
Page 130 and 131: Franses, Philip Hans and Richard Pa
Page 132 and 133: Narasimhan, Chakravartthi, Scott A.
Page 134 and 135: Van Trijp, Hans C.M., Wayne D. Hoye
Page 136 and 137: de rol van het assortiment bij het
Page 138 and 139: die het out-of-stock niveau binnen
Page 140 and 141: Campbell, R.A.J., Rethinking Risk i
Page 142 and 143: Langen, P.W. de, The Performance of
Page 144 and 145: Slager, A.M.H., Banking across Bord
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