Understanding Consumer Reactions to Assortment Unavailability

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The mathematical formulation of the multinomial logit model states that the probability (P) of choosing OOS reaction j by consumer i is given by: exp( V ) j, i P j, i = . (1) 4 ∑ exp( V j, i ) j= 1 The model in which we include brand equity (BE), the hedonic level of the product (HL), the interaction effect (BE * HL) and K other variables (X) (see Appendix 2A for examples) is defined as follows: K j, i = ∑ α + + + + J 0, j α1, j * BEi α2, j * HLi α3, j * BEi * HLi ∑ γ k, j * Xk, i . (2) k= 1 V The inclusion of an interaction effect between brand equity and the hedonic level of the product may affect our estimation results. We therefore standardize brand equity and hedonic level and include the standardized scores in our model (Aiken and West 1991). Thus, the interaction effect is included as the multiplication of the two standardized variables (see Equation 2). 2.5 Empirical results 2.5.1 Descriptive analysis We explore differences in OOS reactions according to the nature of the product (utilitarian versus hedonic) and the level of brand equity (low versus high) using cross tabulations (see Table 2.5). Our analysis shows that buyers of low-equity brands are much more likely to switch brands (51%) than are buyers of high-equity brands (26%). Buyers of high-equity brands are more likely to switch stores (25%) than are buyers of low-equity brands (10%), as well as switch items (21% versus 14%, respectively). A χ 2 test reveals a significant association between brand equity and OOS reaction (χ 2 = 54.622, p = 0.000). In both utilitarian and hedonic product groups, the most common reaction to an OOS occurrence is brand switching. However, the percentage of brand switching is higher for utilitarian product groups (39%) than for hedonic product groups (31%). In contrast, store 45
switching occurs more frequently in hedonic product groups (26%) than in utilitarian product groups (13%). Again, the χ 2 test shows a significant association between product type (utilitarian of hedonic) and OOS reactions (χ 2 = 22.581, p = 0.000). Table 2.5: Descriptive analysis of stock-out response per brand equity type and hedonic level Brand switch Store switch Item switch Postpone purchase Low (n = 261) Brand Equity (n = 734) 6 Hedonic Level (n = 734) 7 High (n = 473) t-Test (two-tailed) 46 Low (n = 360) High (n = 374) t-Test (two-tailed) 51% 26% p = 0.000 39% 31% p = 0.02 10% 25% p = 0.000 13% 26% p = 0.000 14% 21% p = 0.012 19% 18% NS 26% 27% NS 29% 25% NS 2.5.2 Multinomial logit model Prior to estimating the multinomial logit model for Equation 2, we assess whether multicollinearity might cause severe problems in our data by considering the correlation among the independent variables. The correlation matrix, displayed in Table 2.6, shows that correlation between independent variables in general is low and that multicollinearity will not affect our estimation results significantly (Leeflang et al. 2000). Due to the addition of product-, store-, situation-, and consumer-related variables, the valid case number drops from 734 to 681. The estimation results of the multinomial logit model (Equation 2) appear in Table 2.7. The χ 2 of the multinomial logit model is 235.24 (d.f. = 60, p = 0.00). 6 Low brand equity < 5.00; high brand equity ≥ 5.00. 7 Low hedonic level < 4.00; high hedonic level ≥ 4.00.
Page 1 and 2: LAURENS SLOOT Understanding Consume
Page 4 and 5: UNDERSTANDING CONSUMER REACTIONS TO
Page 6 and 7: PREFACE (IN DUTCH) Begin 2001 schre
Page 8 and 9: TABLE OF CONTENTS Preface (in Dutch
Page 10 and 11: 3.7 Study 2 74 3.8 Hypotheses 74 3.
Page 12 and 13: CHAPTER 1: INTRODUCTION AND OVERVIE
Page 14 and 15: Most supply chain-oriented reductio
Page 16 and 17: 400 square meters) are disappearing
Page 18 and 19: more. However, Aldi is known to be
Page 20 and 21: antecedents, such as the brand equi
Page 22 and 23: of assortment reduction responses a
Page 24 and 25: assortment benefits and assortment
Page 26 and 27: 2.1 Introduction Out-of-stock (OOS)
Page 28 and 29: other explanatory studies, we study
Page 30 and 31: Studies that apply exploratory desi
Page 32 and 33: Table 2.2: Methodological overview
Page 34 and 35: Situation-related variables. Situat
Page 36 and 37: As noted, consumers generally prefe
Page 38 and 39: 2.3.3 The interaction of hedonic le
Page 40 and 41: For example, supermarkets are usual
Page 42 and 43: were selected for further analyses.
Page 44 and 45: example, a key utilitarian benefit
Page 48 and 49: Table 2.6: Correlation matrix depen
Page 50 and 51: correlation between the hedonic lev
Page 52 and 53: 2.6 Discussion In this study, we in
Page 54 and 55: Following the literature on promoti
Page 56 and 57: consider this finding when they att
Page 58 and 59: Appendix 2A: Overview and definitio
Page 60 and 61: CHAPTER 3 UNDERSTANDING THE IMPACT
Page 62 and 63: the Dutch food retailer Edah delist
Page 64 and 65: FMI (1993) conducts natural experim
Page 66 and 67: customers no longer or less frequen
Page 68 and 69: 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
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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
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infrequently in the sample stores a
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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
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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
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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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