Understanding Consumer Reactions to Assortment Unavailability

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2. When retailers set priorities for reducing stock-outs, they should pay extra attention to preventing stock-outs of market leader brands. Furthermore, retailers should focus on preventing out-of-stocks for impulse products (e.g., salty snacks) and hedonic product categories (e.g., beer, cigarettes, ice cream). 3. In general consumers will be more loyal to a specific store than to a specific brand in case of a brand reduction. Therefore, retailers have a strong position in comparison with suppliers when they negotiate better buying conditions. However, boycotting a high-equity brand by a retailer might not be a smart move when a supplier does not lower its buying price. In many cases, a brand boycott will lead to lower category sales, and it may also lead to the loss of (part of) the consumers’ shopping basket as consumers may decide to switch stores. 4. Reducing assortment by eliminating low-selling items with clear me-too alternatives is in general a good business decisions because it leads to a lower complexity and saves supply chain costs. Furthermore, research shows that eliminating redundant items increases the perceived assortment efficiency and decreases search time. In addition to that, “cleaned up” assortments may attract new buyers to the category. 5. Because reducing assortments may cause a loss of category sales, retailers should test major assortment reductions (e.g., 10% or more of the category items) in advance of the decision to roll out the assortment reduction nationally. Our research shows that long-term effects differ from short-term effects, so these pilot studies should be carried out in a time period that is long enough to measure both short-term and long-term effects. As a rule of thumb, we suggest pilot studies on assortment reduction span four to six times the average interpurchase time of the product group of interest. 5.4 Limitations and suggestions for further research Our studies have some important limitations that may provide interesting opportunities for further research. First, the essays in Chapters 2 and 3 use survey data to study the impact of a hypothetical assortment unavailability. Using retail scanner or household panel data could enhance the validity of their results. Second, though Chapter 4 uses household panel data, the number of product groups (i.e., one) is not appropriate for generalizing the findings to other product groups. Therefore, replica studies should include more categories to determine if our findings can be generalized. 123
Furthermore, Chapter 4 is based on results obtained from only four stores. Because every store has its own unique characteristics and each store environment is different, further research should be based on data collected from more stores and, preferably, multiple retail chains. Third, in the highly competitive retailing environment, retailers must constantly renew their concepts to remain successful or become successful again. For example, Edah changed its concept to Edah Lekker & Laag by lowering the average price of its assortment by 8% while delisting 2,000 national-brand items and introducing 1,000 store-brand items. Another example is the Albert Heijn Operation Pitstop in 2005, during which the retailer reduced its assortment by almost 1,500 items. In these situations, assortment reductions occur in multiple product groups at the same time. Such scenarios enable researchers to study (1) cross-category effects and (2) the effect of multiple (experienced) delistings of preferred items on category sales and store loyalty. 124
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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
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Figure 3.1: Graphical display of as
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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 120 and 121: eduction occurs, and the type of st
Page 122 and 123: Manufacturers in hedonic product gr
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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