Analysis of Sales Promotion Effects on Household Purchase Behavior

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5 METHDOLOGY, MODEL, AND MEASURES 5.1 Introduction In this chapter we develop the general framework for studying the effects <strong>of</strong> sales promotions on individual household purchase behavior. The framework described in section 5.2 is based on findings and ideas from prior research. It describes the way households are influenced by sales promotions in their purchase behavior. We identify variables that are expected to influence the consumer as a result <strong>of</strong> sales promotions. Section 5.3 <strong>of</strong>fers insight in the two-step approach used in this research to answer the research questions. The two research models developed and applied in the research are dealt with in section 5.4 in detail. 5.2 Perspective <strong>of</strong> <strong>Analysis</strong> As mentioned in the previous chapters, several variables play an important role in explaining the effects <strong>of</strong> sales promotions on consumer purchase behavior. Different researchers studied sales promotion response using different dimensions. The dimensions incorporated in this research are: (1) household variables (demographics, psychographics, socio-economics, and purchase process characteristics), (2) sales promotion reaction mechanism (brand switching, store switching, purchase acceleration, category expansion, and repeat purchasing), (3) promotion-type (display, feature, price-cut, and combinations), and (4) product category characteristics. Figure 5.1 describes the way we believe that individual households are affected by sales promotions in their FMCG purchase behavior. Overt promotion response is influenced by many variables, such as income, time, size <strong>of</strong> the household, composition <strong>of</strong> the household, mobility <strong>of</strong> the household, occasion <strong>of</strong> the shopping trip, information (whether the household is acquainted with the promotional activity), and deal proneness. Not all <strong>of</strong> these variables are incorporated in the framework. Only variables that are household dependent and more or less constant over time (and therefore constant over shopping trips) are used in this research. Involvement is assumed to be related to variety 85
seeking (cf. Assael 1987, Desphande and Hoyer 1983, Van Trijp et al. 1996) and therefore indirectly incorporated. We want to derive drivers <strong>of</strong> promotion response in general. In our research, we use the four distinguished dimensions as entries to study effects <strong>of</strong> sales promotions on household purchase behavior. Household Characteristics Income Time Size Composition Mobility Deal Proneness trait C<strong>of</strong>fee Variety Seeking Figure 5.1: Pictorial representation <strong>of</strong> promotion response research As mentioned in the previous chapters, most prior research concluded that overt promotion response differs across sales promotion reaction mechanism, deal-type, and product category. Recently, however, Ainslie and Rossi (1998) found empirical evidence for treating deal proneness as an individual household trait. They found similarities in brand choice behavior within promotion-type across product category. These findings provide support for treating deal proneness as a latent, unobservable, individual household trait. We will expand on this study to find out whether this cross category similarity also applies to other mechanisms than brand choice. We distinguish four types <strong>of</strong> variables and incorporate all <strong>of</strong> them in our research framework, providing opportunities to empirically test whether deal proneness is indeed a general trait. If households do not show any consistency or similarity in their overt 86 Store Switching Purchase acceleration Category Expansion Repeat Purchasing price S<strong>of</strong>t-drinks Fruit Juice Product Category Candy-bars Pasta Product Category Characteristics Storability Storage Life # Brands Impulse <strong>Sales</strong> <strong>Promotion</strong> Reaction Mechanism Potato Chips ~ Brand Switching display feature combination <strong>Promotion</strong> Type
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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
Page 46 and 47: compared to a perceived benchmark -
Page 48 and 49: High need-for-cognition (NFC) indiv
Page 50 and 51: 2.3.4.2 Literature Overview Our rev
Page 52 and 53: The previously described research h
Page 54 and 55: has its deficiencies. Any purchase
Page 56 and 57: Chandon et al. 2000). But deal pron
Page 58 and 59: 2.4 Concluding Remarks Regarding th
Page 60: stimulus-organism-response model) c
Page 63 and 64: Shoemaker 1987). Several factors ha
Page 65 and 66: such as display promotions. Althoug
Page 67 and 68: 3.2.3 Type of resi
Page 69 and 70: 3.2.5 Education Education links to
Page 71 and 72: these advantages therefore could be
Page 73 and 74: less likely to seek variety. More e
Page 75 and 76: 3.3.1 Store Loyalty Store loyalty s
Page 77 and 78: more often (probab
Page 79 and 80: Table 3.12 continued Hypothesis H9a
Page 81 and 82: 4.2.1 Brand Switching Brand switchi
Page 83 and 84: involvement purchases for most cons
Page 85 and 86: Neslin (1998), there is a great nee
Page 87 and 88: are called “attributions.” Attr
Page 89 and 90: and less than 2 percent by stockpil
Page 91 and 92: into a unit sales decomposition and
Page 93 and 94: 4.3.4 Storability/Perishability Sto
Page 95: Economic theory ignores mental deci
Page 99 and 100: there another factor that is relate
Page 101 and 102: Pr(event) 90 = 1+ 1 z e − Here Z
Page 103 and 104: 5.4.2 Sales <stron
Page 105 and 106: It represents the fraction
Page 107 and 108: 96 We measure possible time acceler
Page 109 and 110: promotional post-promotional purcha
Page 111 and 112: ( 12) CategoryExpansion effect : 10
Page 114: PART II EMPIRICAL ANALYSIS 103
Page 117 and 118: more persons living together and di
Page 119 and 120: 6.4 Linking Household and Store Dat
Page 121 and 122: Table 6.1 contains the results <str
Page 123 and 124: The age of the sho
Page 125 and 126: Table 6.4: Frequency distribution <
Page 128 and 129: 7 EMPIRICAL ANALYSIS ONE: DRIVERS O
Page 130 and 131: Table 7.1: Operationalization <stro
Page 132 and 133: during 435 shopping trips more than
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 144 and 145: Table 7.6: Relationship promotion r
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Table 7.8: Relationship promotion r
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Table 7.10: Relationship promotion
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7.5.2.8 Variety Seeking Two intrins
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anymore. Therefore it is concluded
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Thus, store loyalty and promotion r
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dummies add up to one. This implies
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Table 7.22: Overview empirical test
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enacting-on-impulse hypothesis and
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Table 7.23: Summary of</str
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Table 7.24: Correlation error coeff
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another category? Or do households
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and unweighted. With respect to the
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164 In general, the average quantit
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Purchase frequency is defined as th
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Table 8.3: Product category rating
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Table 8.4: Pearson correlation betw
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We hypothesized that within impulse
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measure (PU). Referring to Figure A
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Table 8.6: Significant within categ
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looked at this promotional bump dec
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Table 8.8: Differences in promotion
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approach (about one third) are much
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promotions lead to large purchase t
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studies. Promotion
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Promotional extra
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categories revealed that the strong
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degree. When households switch bran
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specific sales promotion reaction m
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increasing (Inman and Winer 1998),
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indirectly from promotional purchas
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quantity downward for potato chips.
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9.2.2.3 Deal Proneness With respect
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204 related to promotion response.
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influenced by out-of</stron
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Andrews, K.Z. (1997), “Do Marketi
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Blattberg, R.C., Eppen, G.D. and J.
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Chintagunta, P. (1993), “Investig
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East, R. and K. Hammond (1996), “
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Gupta, Sachin and P.K. Chintagunta
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Kahn, B.E., Morrison, D.G.and G.P.
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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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