Analysis of Sales Promotion Effects on Household Purchase Behavior

3 HOUSEHOLD CHARACTERISTICS RELATED TO
PROMOTION RESPONSE
3.1 Introduction
The widespread use <strong>of</strong> retail promotions has motivated researchers to identify the factors
associated with promotion response (e.g., Blattberg et al. 1978; Montgomery 1971;
Narasimhan 1984; Webster 1965). Researchers have suggested that a household’s response
to promotions is partly determined by household characteristics such as household income,
education, and family size. However, prior research has led to conflicting findings. A clear,
unequivocal relationship between demographics and household response to promotions has
not yet been found. Of the demographic variables that have been examined, the positive
relationship between promotion response and household size is the most consistent (Mittal
1994).
In this chapter, we derive hypotheses dealing with the possible drivers <strong>of</strong>
promotion response. We investigate the relationship between promotion response and
household demographics (for example household size, age, and pr<strong>of</strong>ession) and household
purchase characteristics (for example shopping frequency, store loyalty, and size <strong>of</strong> the
shopping basket). Section 3.2 contains an overview or prior research findings regarding
household characteristics and their relationship with promotion response, leading to
hypotheses about the drivers <strong>of</strong> promotion response. Interaction effects are also dealt with.
Household purchase characteristics are discussed in Section 3.3 as possible drivers <strong>of</strong>
promotion response, also leading to hypotheses regarding their influence on promotion
response.
3.2 Overview <strong>Promotion</strong> Response Findings Household Characteristics
Since the 1960s, managers and researchers have tried to identify the characteristics <strong>of</strong> those
households that are responsive to sales promotions (e.g., Webster 1965, Massy and Frank
1965, Blattberg and Sen 1974, Blattberg et al., 1978, Cotton and Babb 1978, Bawa and
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