Understanding Consumer Reactions to Assortment Unavailability
Understanding Consumer Reactions to Assortment Unavailability
Understanding Consumer Reactions to Assortment Unavailability
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CHAPTER 4<br />
THE SHORT- AND LONG-TERM IMPACT OF AN ASSORTMENT<br />
REDUCTION ON CATEGORY SALES<br />
Abstract<br />
In a collaborative study with a major Dutch retailer, we assess the short- and long-term effects of<br />
a 25% item reduction on category sales. On an aggregate level, a major assortment reduction can<br />
lead <strong>to</strong> substantive short-term category sales losses with only a weak negative long-term<br />
category sales effect. Short-term category sales losses are caused mainly by fewer category<br />
purchases by former buyers of delisted items. Our results also indicate that the assortment<br />
reduction attracts new buyers due <strong>to</strong> decreased search complexity, which partially offsets the<br />
sales losses among former buyers of the delisted items. An additional study, in which assortment<br />
perceptions and actual search time are investigated before and after the assortment reduction,<br />
provides evidence that the delisting results in reduced search complexity.<br />
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