Analysis of Sales Promotion Effects on Household Purchase Behavior

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guide purchases once consumers are inside a store. They do not accelerate purchase timing. But, they do decelerate post-promotional purchases within these higher priced categories. Purchase frequency was hypothesized to be positively related with promotional effects, especially with brand switching (H2). But the results are different. First <strong>of</strong> all, purchase frequency is not significantly related with promotional utilization. Furthermore, promotions even seem to lead to less brand switching within categories that are purchased more <strong>of</strong>ten. One explanation could be that households have more pronounced preferences for frequently purchased product categories. <strong>Promotion</strong>s for frequently purchased product categories turn out to be significantly negatively related with purchase quantity (QP, QN) and category expansion (CE). Apparently, it is more difficult for a product to create new, additional consumption opportunities when consumption is already rather high. We expected that promotions for more <strong>of</strong>ten promoted categories are less effective (H3). The findings do show a negative, significant relationship between promotional frequency and the quantity purchased during the promotional shopping trip (QP) and the net intertemporal effect on quantity (QN). Testing one-sided, promotional frequency and category expansion are also significantly negatively related. Regarding the first (negative) indicator <strong>of</strong> storability, modal unit-size, we find that promotions for bulkier products are less effective. More easy to store products lead more <strong>of</strong>ten to brand switching (BS) and extra promotional quantity (QP, QN). The second indicator seems to be positively related with promotional quantity (QP, QN). <strong>Promotion</strong>s for better storable products lead to extra promotional volume sold. The hypothesis that storability and promotional effects are positively related (H4) is therefore supported by the findings, especially in terms <strong>of</strong> extra volume purchased during the promotional shopping trip. With respect to number <strong>of</strong> brands within a category, we hypothesized that it would have a positive relationship with promotional effects, due to both brand switching and purchase acceleration (H6). Surprisingly, we do not find evidence for a positive relationship between number <strong>of</strong> SKU’s within a category and promotional utilization in general (PU) or brand switching (BS), time acceleration (TA, TN), or the promotional quantity purchased (QP, QN). 171
We hypothesized that within impulse categories, promotions would lead to more promotion effects, both due to brand switching and purchase acceleration (H7). A significant positive relationship between impulse and promotional utilization (PU) is found. But, based on Table 8.4, promotions for impulse products seem to result in less extra promotional volume. The category characteristics identified are, <strong>of</strong> course, not independent. For example with respect to purchase frequency and storability, hard to store products are expected to be purchased more <strong>of</strong>ten and in smaller quantities than easy to store products. But, surprisingly, we find that easy to store products are also bought more frequently (results are not shown). Another interesting finding is that promotional frequency and impulse are positively related (results not shown). The causal direction <strong>of</strong> this relationship is not clear. Retailers can identify that some products, especially high impulse products, are mostly bought on promotion and therefore promote them a lot. But it could also be the other way around (or both ways). Consumers identify categories that are <strong>of</strong>ten promoted, which leads to cherry picking. The findings presented in this section show that promotion utilization and the occurrence <strong>of</strong> the sales promotion reaction mechanisms are related to some extent to product category characteristics (although the findings have to be interpreted with care as they are based on data from six product categories). Now that we have found that the average intensity <strong>of</strong> the sales promotion reaction mechanisms differs across product categories, the follow-up step is to investigate whether these differences are also found at the specific household level. Do households differ in their sales promotion reactions across the product categories or not? Do households that switch brands for pasta during 20 percent <strong>of</strong> the promotional shopping trips also switch brands for c<strong>of</strong>fee during 20 percent <strong>of</strong> the promotional shopping trips or more <strong>of</strong>ten or less <strong>of</strong>ten? These types <strong>of</strong> questions will be answered in the next section. 172
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LINDA H. TEUNTER Analysis</
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Analysis o
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Voorwoord Soms valt de appel echt n
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Contents 1 INTRODUCTION AND OVERVIE
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5.4.2.3.1 Inter Purchase Time .....
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1 INTRODUCTION AND OVERVIEW 1.1 Int
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generally generated from a smaller
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switching, purchase acceleration, c
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strategy change (decrease in promot
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of promotions, or
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characteristics are important in ex
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Chapter 5 are applied to study the
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2 THEORIES OF CONSUMER BUYING BEHAV
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systematically explored the decisio
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the part of the co
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As mentioned before, Figure 2.3 is
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product use coupled with the import
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2.3.2 Stimulus-Response Model Appli
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2.3.2.2 Operant Conditioning In ope
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X is very popular that it will brin
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But, in contrast, economic theory c
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compared to a perceived benchmark -
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High need-for-cognition (NFC) indiv
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2.3.4.2 Literature Overview Our rev
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The previously described research h
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has its deficiencies. Any purchase
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Chandon et al. 2000). But deal pron
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2.4 Concluding Remarks Regarding th
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stimulus-organism-response model) c
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Shoemaker 1987). Several factors ha
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such as display promotions. Althoug
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3.2.3 Type of resi
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3.2.5 Education Education links to
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these advantages therefore could be
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less likely to seek variety. More e
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3.3.1 Store Loyalty Store loyalty s
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more often (probab
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Table 3.12 continued Hypothesis H9a
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4.2.1 Brand Switching Brand switchi
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involvement purchases for most cons
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Neslin (1998), there is a great nee
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are called “attributions.” Attr
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and less than 2 percent by stockpil
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into a unit sales decomposition and
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4.3.4 Storability/Perishability Sto
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Economic theory ignores mental deci
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seeking (cf. Assael 1987, Desphande
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there another factor that is relate
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Pr(event) 90 = 1+ 1 z e − Here Z
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5.4.2 Sales <stron
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It represents the fraction
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96 We measure possible time acceler
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promotional post-promotional purcha
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( 12) CategoryExpansion effect : 10
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PART II EMPIRICAL ANALYSIS 103
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more persons living together and di
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6.4 Linking Household and Store Dat
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Table 6.1 contains the results <str
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The age of the sho
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Table 6.4: Frequency distribution <
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7 EMPIRICAL ANALYSIS ONE: DRIVERS O
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Table 7.1: Operationalization <stro
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Page 134 and 135: The variables size, age, and cycle
Page 136 and 137: 7.5 Results Drivers of</str
Page 138 and 139: esponsive the households within tha
Page 140 and 141: Table 7.3: Relationship promotion r
Page 142 and 143: indication that decreasing marginal
Page 148 and 149: Table 7.10: Relationship promotion
Page 154 and 155: 7.5.2.8 Variety Seeking Two intrins
Page 156 and 157: anymore. Therefore it is concluded
Page 158 and 159: Thus, store loyalty and promotion r
Page 160 and 161: dummies add up to one. This implies
Page 162 and 163: Table 7.22: Overview empirical test
Page 164 and 165: enacting-on-impulse hypothesis and
Page 166 and 167: Table 7.23: Summary of</str
Page 168: Table 7.24: Correlation error coeff
Page 171 and 172: another category? Or do households
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Page 175 and 176: 164 In general, the average quantit
Page 177 and 178: Purchase frequency is defined as th
Page 179 and 180: Table 8.3: Product category rating
Page 181: Table 8.4: Pearson correlation betw
Page 185 and 186: measure (PU). Referring to Figure A
Page 187 and 188: Table 8.6: Significant within categ
Page 189 and 190: looked at this promotional bump dec
Page 191 and 192: Table 8.8: Differences in promotion
Page 193 and 194: approach (about one third) are much
Page 195 and 196: promotions lead to large purchase t
Page 197 and 198: studies. Promotion
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Page 201 and 202: categories revealed that the strong
Page 203 and 204: degree. When households switch bran
Page 205 and 206: specific sales promotion reaction m
Page 207 and 208: increasing (Inman and Winer 1998),
Page 209 and 210: indirectly from promotional purchas
Page 211 and 212: quantity downward for potato chips.
Page 213 and 214: 9.2.2.3 Deal Proneness With respect
Page 215 and 216: 204 related to promotion response.
Page 217 and 218: influenced by out-of</stron
Page 219 and 220: Andrews, K.Z. (1997), “Do Marketi
Page 221 and 222: Blattberg, R.C., Eppen, G.D. and J.
Page 223 and 224: Chintagunta, P. (1993), “Investig
Page 225 and 226: East, R. and K. Hammond (1996), “
Page 227 and 228: Gupta, Sachin and P.K. Chintagunta
Page 229 and 230: Kahn, B.E., Morrison, D.G.and G.P.
Page 231 and 232: Lattin, J.M. and R.E. Bucklin (1989
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McAlister, L. and E. Pessemier (198
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Petty, R.E. and J.T. Cacioppo (1981
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Shimp, T.A. (1990). Promoti
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Van Trijp, H.C.M. and J.B.E.M. Stee
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Winer, R.S., Bucklin, R.E., Deighto
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APPENDIX A4: Research Overview Tabl
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Table A4.1 continued Article Promot
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� Size of munici
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Table A7.1 continued Symbol Descrip
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Table A7.2: Data legitimacy check (
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Table A7.3: Results binary logistic
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Table A7.4: Results interacting wit
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Table A7.5: Results age and size no
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Table A7.5 continued Variable B S.E
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Table A8.1 continued Impulse BS TA
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Table A8.2 continued Number <strong
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Table A8.3: Relative occurrence and
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Figure A8.2: Decomposing total prom
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interessante aanbieding is. Combina
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aantalmerken in een categorie en im
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ERASMUS RESEARCH INSTITUTE OF MANAG
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Title: Beyond Generics;A closer loo
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Title: Planning and Control Concept
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