Sanjay K. Dhar

Brand Performance across Store Formats: Beyond Walmart's Low Prices
Date Posted:Wed, 21 Sep 2022 01:59:51 -0500
We study whether certain types of brands are more likely to perform better at Walmart supercenters as compared to supermarkets. We correlate the variation in brand sales performance at these two store formats (over time and across markets) with marketing mix variables such as prices, promotions, assortments, and competition while controlling for market and time specific trends, and differences in consumers shopping at different formats. Based on data from four product categories in the Nielsen homescan panel, we consistently find that value brands perform better at Walmart supercenters, while premium brands perform better at supermarkets. We find substantial differences in assortments carried at Walmart supercenters and supermarkets. On average, assortment explains 30% of the variation in relative brand shares while prices and promotions explain 24% of the variation. Importantly, this pattern persists among consumers not loyal to either format i.e., who split their spending at different formats. We also find that consumers spending over 75% of their basket expenditures on Walmart shop premium and value brands in more similar proportions across formats as compared to consumers spending over 75% in supermarkets. These latter consumers purchase premium brands in greater proportions when shopping at the supermarkets and value brands in greater proportions when shopping at Walmart. Finally, consumers who split their baskets more evenly across formats are more price sensitive than

REVISION: Show and Sell: Studying the Effects of Branded Cigarette Product Placement in TV Shows on Cigarette Sales
Date Posted:Tue, 01 Feb 2022 21:16:00 -0600
We evaluate whether and how branded TV product placement affects sales for cigarette brands. We use data on product placement from TV shows and data on retail sales of cigarettes to estimate a demand model that incorporates the level of product placement exposure for each cigarette brand. We find that product placement has a small yet positive and statistically significant effect on both own-brand sales and competitor-brand sales: both of these elasticities are roughly 0.02. These results indicate that cigarette product placement affects demand for individual cigarette brands and that it also leads to greater overall cigarette use. This issue is of particular importance to policymakers because product placement is one of the few remaining ways that cigarette brands can reach a mass audience. To illustrate how these results could be used by policymakers, we use our model estimates to evaluate how cigarette sales would be affected by two hypothetical kinds of regulations. Limiting ...

REVISION: Show and Sell: Studying the Effects of Branded Cigarette Product Placement in TV Shows on Cigarette Sales
Date Posted:Tue, 04 Jan 2022 19:41:16 -0600
We evaluate whether and how branded TV product placement affects sales for cigarette brands. We use data on product placement from TV shows and data on retail sales of cigarettes to estimate a demand model that incorporates the level of product placement exposure for each cigarette brand. We find that product placement has a small yet positive and statistically significant effect on both own-brand sales and competitor-brand sales: both of these elasticities are roughly 0.02. These results indicate that cigarette product placement affects demand for individual cigarette brands and that it also leads to greater overall cigarette use. This issue is of particular importance to policymakers because product placement is one of the few remaining ways that cigarette brands can reach a mass audience. To illustrate how these results could be used by policymakers, we use our model estimates to evaluate how cigarette sales would be affected by two hypothetical kinds of regulations. Limiting ...

REVISION: Do Households' Budget Allocations Vary with Economic Factors? Evidence from Nielsen Data
Date Posted:Sat, 16 Oct 2021 01:16:46 -0500
How do households' joint budget allocations across different store types (grocery vs. discount vs. warehouse vs other stores), category types (food vs. non food) and brand types (private label vs. national brand) change with changes to their income, wealth, employment status, household size and macro factors like the recession? We answer this question using consumer packaged goods (CPG) purchases from more than 1000 categories by a representative panel of US households over fourteen years. We measure within household effects on expenditure shares of joint bivariate (e.g., grocery-food) and trivariate (e.g. grocery-food-private label) baskets along with their effects on univariate baskets. We demonstrate that such an analysis is important for nuanced responses to changes in economic conditions by managers across the different combinations of store formats, product categories and brand types. For example, managers of national brands looking at univariate baskets would conclude that an ...

REVISION: Do Households' Budget Allocations Vary with Economic Factors? Evidence from Nielsen Data
Date Posted:Tue, 12 Oct 2021 19:38:33 -0500
How do households' joint budget allocations across different store types (grocery vs. discount vs. warehouse vs other stores), category types (food vs. non food) and brand types (private label vs. national brand) change with changes to their income, wealth, employment status, household size and macro factors like the recession? We answer this question using consumer packaged goods (CPG) purchases from more than 1000 categories by a representative panel of US households over fourteen years. We measure within household effects on expenditure shares of joint bivariate (e.g., grocery-food) and trivariate (e.g. grocery-food-private label) baskets along with their effects on univariate baskets. We demonstrate that such an analysis is important for nuanced responses to changes in economic conditions by managers across the different combinations of store formats, product categories and brand types. For example, managers of national brands looking at univariate baskets would conclude that an ...

REVISION: Show and Sell: Studying the Effects of Branded Cigarette Product Placement in TV Shows on Cigarette Sales
Date Posted:Tue, 03 Aug 2021 06:05:43 -0500
We evaluate whether and how branded TV product placement affects sales for cigarette brands. We use data on product placement from TV shows and data on retail sales of cigarettes to estimate a demand model that incorporates the level of product placement exposure for each cigarette brand. We find that product placement has a small yet positive and statistically significant effect on both own-brand sales and competitor-brand sales: both of these elasticities are roughly 0.02. These results indicate that cigarette product placement affects demand for individual cigarette brands and that it also leads to greater overall cigarette use. This issue is of particular importance to policymakers because product placement is one of the few remaining ways that cigarette brands can reach a mass audience. To illustrate how these results could be used by policymakers, we use our model estimates to evaluate how cigarette sales would be affected by two hypothetical kinds of regulations. Limiting ...

Show and Sell: Studying the Effects of Branded Cigarette Product Placement in TV Shows on Cigarette Sales
Date Posted:Tue, 06 Jul 2021 20:57:35 -0500
We evaluate whether and how branded TV product placement affects sales for cigarette brands. We use data on product placement from TV shows and data on retail sales of cigarettes to estimate a demand model that incorporates the level of product placement exposure for each cigarette brand. We find that product placement has a small yet positive and statistically significant effect on both own-brand sales and competitor-brand sales: both of these elasticities are roughly 0.02. These results indicate that cigarette product placement affects demand for individual cigarette brands and that it also leads to greater overall cigarette use. This issue is of particular importance to policymakers because product placement is one of the few remaining ways that cigarette brands can reach a mass audience. To illustrate how these results could be used by policymakers, we use our model estimates to evaluate how cigarette sales would be affected by two hypothetical kinds of regulations. Limiting brands? ability to be displayed on TV and forcing TV networks to instead use generic, unbranded cigarettes on screen would only reduce cigarette sales by about 2 percent, while forcing TV networks to eliminate all on-screen smoking activity would reduce cigarette sales by about 7 percent.

REVISION: Show and Sell: Studying the Effects of Branded Cigarette Product Placement in TV Programs on Cigarette Sales
Date Posted:Tue, 06 Jul 2021 12:01:50 -0500
We evaluate whether and how branded TV product placement affects sales for cigarette brands. We use data on product placement from TV shows and data on retail sales of cigarettes to estimate a demand model that incorporates the level of product placement exposure for each cigarette brand. We find that product placement has a small yet positive and statistically significant effect on both own-brand sales and competitor-brand sales: both of these elasticities are roughly 0.02. These results indicate that cigarette product placement affects demand for individual cigarette brands and that it also leads to greater overall cigarette use. This issue is of particular importance to policymakers because product placement is one of the few remaining ways that cigarette brands can reach a mass audience. To illustrate how these results could be used by policymakers, we use our model estimates to evaluate how cigarette sales would be affected by two hypothetical kinds of regulations. Limiting ...

REVISION: Marketing Mix Response Across Retail Formats - The Role of Shopping Trip Types
Date Posted:Fri, 04 Dec 2020 03:12:46 -0600
We study differences in the effects of prices, non-price promotions, and brand line length on brand shares at different retail formats. Our conceptual framework rests on the presence of trip level fixed and category level variable utility components and shows how the trade-off between these components results in (i) different formats visited on different types of shopping trips; and (ii) differential marginal sensitivities of brand shares to changes in marketing mix variables across trip types. Together, these provide predictions on how marketing mix variables differentially impact brand shares at various retail formats. We use Nielsen Homescan and store level data from 2011-2014 and analyze the top ten spending product categories across four retail formats - convenience stores, drug stores, supermarkets and mass merchandisers, in over 200 Nielsen markets. We then describe how our findings linking the effects of marketing mix variables with different retail formats has implications ...

REVISION: Income and Wealth Effects on Consumer Packaged Goods Purchases
Date Posted:Tue, 03 Mar 2020 05:44:06 -0600
When economic cycles cause changes in household income and wealth, consumers change their budget allocations across store formats, product categories, and brands. Using Nielsen Homescan data for the years 2004 to 2014, we investigate the impact of income and wealth changes on households' budget allocations to (i) alternative store formats; (ii) food and non-food categories; and (iii) private labels and national brands. Since budgets can be reallocated across formats, categories and brands simultaneously, we measure the causal effects on the "joint' (e.g., grocery store - food - national brand budget shares) budget allocations of households. This allows us to decompose income and wealth effects on the "marginal' (e.g., grocery store) shares, which previous literature has focused on, into those on its joint components (e.g., grocery - food - national brand, grocery - food - private label, etc.). This joint analysis reveals situations in which managers of a specific brand-type in a ...

Do Households' Budget Allocations Vary with Economic Factors? Evidence from Nielsen Data
Date Posted:Tue, 07 Jan 2020 19:16:10 -0600
How do households' joint budget allocations across different store types (grocery vs. discount vs. warehouse vs other stores), category types (food vs. non food) and brand types (private label vs. national brand) change with changes to their income, wealth, employment status, household size and macro factors like the recession? We answer this question using consumer packaged goods (CPG) purchases from more than 1000 categories by a representative panel of US households over fourteen years. We measure within household effects on expenditure shares of joint bivariate (e.g., grocery-food) and trivariate (e.g. grocery-food-private label) baskets along with their effects on univariate baskets. We demonstrate that such an analysis is important for nuanced responses to changes in economic conditions by managers across the different combinations of store formats, product categories and brand types. For example, managers of national brands looking at univariate baskets would conclude that an increase in income is good for their businesses: we find that this would be true for a non-food but not for a food product. We also demonstrate that approximating the joint budget allocation shares or the effects of economic variables on joint budget allocations using separate analyses of store-, category- and brand-type expenditure shares along with an assumption that these decisions are made independently by consumers, can result in incorrect inferences regarding joint baskets.

REVISION: Income and Wealth Effects on Consumer Packaged Goods Purchases
Date Posted:Tue, 07 Jan 2020 09:16:27 -0600
When economic cycles cause changes in household income and wealth, consumers change their budget allocations across store formats, product categories, and brands. Using Nielsen Homescan data for the years 2004 to 2014, we investigate the impact of income and wealth changes on households' budget allocations to (i) alternative store formats; (ii) food and non-food categories; and (iii) private labels and national brands. Since budgets can be reallocated across formats, categories and brands simultaneously, we measure the causal effects on the "joint' (e.g., grocery store - food - national brand budget shares) budget allocations of households. This allows us to decompose income and wealth effects on the "marginal' (e.g., grocery store) shares, which previous literature has focused on, into those on its joint components (e.g., grocery - food - national brand, grocery - food - private label, etc.). This joint analysis reveals situations in which managers of a specific brand-type in a ...

REVISION: Marketing Mix Response Across Retail Formats - The Role of Shopping Trip Types
Date Posted:Sun, 01 Dec 2019 04:13:25 -0600
We study differences in the effects of prices, non-price promotions, and brand line length on brand shares at different retail formats. Our conceptual framework rests on the presence of trip level fixed and category level variable utility components and shows how the trade-off between these components results in (i) different formats visited on different types of shopping trips; and (ii) differential marginal sensitivities of brand shares to changes in marketing mix variables across trip types. Together, these provide predictions on how marketing mix variables differentially impact brand shares at various retail formats. We use Nielsen Homescan and store level data from 2011-2014 and analyze the top ten spending product categories across four retail formats - convenience stores, drug stores, supermarkets and mass merchandisers, in over 200 Nielsen markets. We then describe how our findings linking the effects of marketing mix variables with different retail formats has implications ...

REVISION: Marketing Mix Response Across Retail Formats - The Role of Shopping Trip Types
Date Posted:Sun, 24 Nov 2019 05:50:24 -0600
We study differences in the effects of prices, non-price promotions, and assortment on brand shares at different retail formats. Our conceptual framework rests on the presence of trip level fixed and category level variable utility components and shows how the trade-off between these components results in (i) different formats visited on different types of shopping trips; and (ii) differential marginal sensitivities of brand shares to changes in marketing mix variables across trip types. Together, these provide predictions on how marketing mix variables differentially impact brand shares at various retail formats. We use Nielsen Homescan and store level data from 2011-2014 and analyze the top ten spending product categories across four retail formats - convenience stores, drug stores, supermarkets and mass merchandisers, in over 200 Nielsen markets. We then describe how our findings linking the effects of marketing mix variables with different retail formats has implications for ...

The Effect of the WIC Program on Consumption Patterns in the Cereal Category
Date Posted:Tue, 12 Nov 2019 16:56:08 -0600
The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) is a federally-funded food assistance program for low income participants who are at nutritional risk. Beneficiaries receive vouchers for specific foods and brands, selected for their nutritional value. While the program is designed to improve nutrition, it may also induce changes in consumption behavior that persist beyond participation in the program. In this paper, we study how participation in WIC impacts the consumption patterns and preferences during and after the program. Our analysis focuses on the cereal category, in which the subsidized brands must meet certain nutritional guidelines. As expected, during the program households increase cereal consumption volume and shift their choices towards the WIC-approved brands. More interesting is that once households exit the program, the higher category consumption rate and elevated share of WIC brands persist. To understand the behavioral mechanism underlying these consumption patterns, we estimate a choice model and find an increased preference for WIC brands after controlling for state dependence. The evidence suggests that this targeted food subsidy program is effective in creating behavior change that persists even after the incentive is withdrawn.

New: The Effect of the WIC Program on Consumption Patterns in the Cereal Category
Date Posted:Tue, 12 Nov 2019 06:56:19 -0600
The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) is a federally-funded food assistance program for low income participants who are at nutritional risk. Beneficiaries receive vouchers for specific foods and brands, selected for their nutritional value. While the program is designed to improve nutrition, it may also induce changes in consumption behavior that persist beyond participation in the program. In this paper, we study how participation in WIC impacts the consumption patterns and preferences during and after the program. Our analysis focuses on the cereal category, in which the subsidized brands must meet certain nutritional guidelines. As expected, during the program households increase cereal consumption volume and shift their choices towards the WIC-approved brands. More interesting is that once households exit the program, the higher category consumption rate and elevated share of WIC brands persist. To understand the behavioral mechanism ...

REVISION: Marketing Mix Response Across Retail Formats - The Role of Shopping Trip Types
Date Posted:Tue, 03 Sep 2019 03:47:40 -0500
In this paper, we study the differences in the effects of marketing mix variables, such as prices, non-price promotions, and assortment, on brand shares at different retail formats. Our conceptual framework rests on the presence of fixed and variable costs of shopping and has two building blocks: (i) The trade-off between these costs has implications for the different formats visited on different types of shopping trips; and (ii) the magnitude of fixed costs, that shoppers can justify investing on different trip types, influences the marginal sensitivities of brand shares to changes in marketing mix variables on those trips. Taken together, the building blocks provide predictions on how marketing mix variables differentially impact brand shares at various retail formats. We use Nielsen Homescan and store level data from 2011-2014 and analyze the top ten spending product categories across four retail formats - convenience stores, drug stores, supermarkets and mass merchandisers, in ...

REVISION: Point-of-Sale Marketing Mix and Brand Performance – The Moderating Role of Retail Format and Brand Type
Date Posted:Tue, 04 Dec 2018 14:56:59 -0600
In this paper, we study the role of point-of-sale (POS) marketing mix variables in explaining variation in brand shares (i) at different retail formats, and (ii) across national and store brands. Different store formats attract different types of shopping trips, and different brand types differ in consumer's quality uncertainty and cross-category spillovers in learning through consumption. Together, these have implications for how POS variables such as prices, features and assortment differentially impact brand shares at different retail formats, and of different brand types, and the corresponding implications for retailers and manufacturers. We use Nielsen store level data from 2011-2014 and analyze the top ten spending product categories across four retail formats - convenience stores, drug stores, supermarkets and mass merchandisers, in over 200 Nielsen markets. Consistent with theoretical predictions, we find that brand shares at convenience (drug) stores are least (most) ...

Marketing Mix Response Across Retail Formats - The Role of Shopping Trip Types
Date Posted:Fri, 02 Mar 2018 16:43:03 -0600
We study differences in the effects of prices, non-price promotions, and brand line length on brand shares at different retail formats. Our conceptual framework rests on the presence of trip level fixed and category level variable utility components and shows how the trade-off between these components results in (i) different formats visited on different types of shopping trips; and (ii) differential marginal sensitivities of brand shares to changes in marketing mix variables across trip types. Together, these provide predictions on how marketing mix variables differentially impact brand shares at various retail formats. We use Nielsen Homescan and store level data from 2011-2014 and analyze the top ten spending product categories across four retail formats - convenience stores, drug stores, supermarkets and mass merchandisers, in over 200 Nielsen markets. We then describe how our findings linking the effects of marketing mix variables with different retail formats has implications for brand manufacturers.

REVISION: Point-of-Sale Marketing Mix and Brand Performance – The Moderating Role of Retail Format and Brand Type
Date Posted:Fri, 02 Mar 2018 06:43:03 -0600
In this paper, we study the role of point-of-sale (POS) marketing mix variables in explaining variation in brand shares (i) at different retail formats, and (ii) across national and store brands in different price tiers. Stores in different retail formats differ in their positioning, the clientele they attract, and types of shopping trips made to the store. Further, national and store brands in different price tiers differ in the quality perception, and the contracts between the retailer and the manufacturer. Together, this implies that POS variables may influence brand shares very differently in different retail formats and for different brand types, which has important implications for retailers and manufacturers. We use Nielsen store level data from 2011-2014 and analyze the top ten spending product categories spreading across four product departments - dry grocery, non-food grocery, dairy and frozen, and across four retail formats - convenience stores, drug stores, supermarkets ...

REVISION: Point-of-Sale Marketing Mix and Brand Performance - The Moderating Role of Retail Format and Brand Type
Date Posted:Wed, 21 Feb 2018 05:49:05 -0600
In this paper, we study the role of point-of-sale (POS) marketing mix variables in explaining variation in brand shares (i) at different retail formats, and (ii) across national and store brands in different price tiers. Stores in different retail formats differ in their positioning, the clientele they attract, and types of shopping trips made to the store. Further, national and store brands in different price tiers differ in the quality perception, and the contracts between the retailer and the manufacturer. Together, this implies that POS variables may influence brand shares very differently in different retail formats and for different brand types, which has important implications for retailers and manufacturers. We use Nielsen store level data from 2011-2014 and analyze the top ten spending product categories spreading across four product departments - dry grocery, non-food grocery, dairy and frozen, and across four retail formats - convenience stores, drug stores, supermarkets ...

REVISION: Brand Performance at Walmart versus Supermarkets – The Role of Marketing Mix and Consumer Format Loyalty
Date Posted:Sat, 15 Jul 2017 06:55:58 -0500
In this paper, we study the role of marketing mix variables in explaining variation in brand shares (i) across different brand types defined based on price tiers, (ii) at supermarkets and Walmart supercenters, and (iii) among loyal and non-loyal consumers of these channels. In doing so, we extend the previous literature (Bronnenberg et al. (2007) and Hwang and Thomadsen (2015)) which explores the role of geographic differences and point of sale activities in explaining variation in brand shares of top brands at supermarkets. In order to draw generalizations across categories, rather than study a subset of brands in each category, we classify brands into “premium”, “value” and “store” brands and study the relative drivers of choices of brands in these groups. We use Nielsen household data from 2011-2014 and analyze 10 product categories which account for 15% of all spending. The categories include dry grocery, non-food grocery, dairy and frozen product departments. We find that shares ...

Update: Brand Performance Across Store Formats: Beyond Walmart's Low Prices
Date Posted:Sun, 28 Aug 2016 13:59:41 -0500
We study whether certain types of brands are more likely to perform better at Walmart supercenters as compared to supermarkets. We correlate the variation in brand sales performance at these two store formats (over time and across markets) with marketing mix variables such as prices, promotions, assortments, and competition while controlling for market and time specific trends, and differences in consumers shopping at different formats. Based on data from four product categories in the Nielsen homescan panel, we consistently find that value brands perform better at Walmart supercenters, while premium brands perform better at supermarkets. We find substantial differences in assortments carried at Walmart supercenters and supermarkets. On average, assortment explains 30% of the variation in relative brand shares while prices and promotions explain 24% of the variation. Importantly, this pattern persists among consumers not loyal to either format i.e., who split their spending at ...
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Update: Food Purchases During the Great Recession
Date Posted:Sun, 28 Aug 2016 11:46:06 -0500
Using the Nielsen Homescan data, we describe what happened to household purchase behavior during the Great recession (Dec 2007-June 2009). Our specific objectives in this study are to understand how the recession impacted: households’ grocery spending in a broad cross-section of 31 food categories; prices paid and quantities bought by households in these categories; the types of outlets they made purchases in; the composition of the food basket in the choice of more expensive brands and less expensive brands and private label products; product volume purchased with retailer discounts and coupons; and, whether there were differences in these behaviors across different demographic groups. We find that during the recession, households purchased more in these food categories, and substituted to cheaper outlets and items sold on deal. However, contrary to expectations, we do not find evidence that the recession was the primary driver behind the increases in store brand share and coupon ...
New PDF Uploaded

Update: Brand History, Geography, and the Persistence of Brand Shares
Date Posted:Sun, 21 Aug 2016 03:38:55 -0500
We study persistence in the geographic variation in market shares of branded goods in consumer packaged goods industries across 50 U.S. city-markets. We match scanner data on local market shares and survey data on local quality perceptions for the largest brands in 34 consumer packaged goods industries. These data are then matched with historic information on the year and US city-market in which each brand was first launched. We find that these consumer brands have persistently higher market shares in markets closest to their respective cities-of-origin than in markets farthest from their respective cities-of-origin, where they were typically launched later. For 6 of the 34 industries, we collected more complete historic entry data with which we can determine the local order of entry among the top brands in each of the 50 U.S. city-markets. We find a persistent effect from differences in the order-of-entry of competing brands on their current relative brand shares and quality ...
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REVISION: Brand Performance Across Store Formats: Beyond Walmart's Low Prices
Date Posted:Sat, 28 Nov 2015 00:26:09 -0600
We study whether certain types of brands are more likely to perform better at Walmart supercenters as compared to supermarkets. We correlate the variation in brand sales performance at these two store formats (over time and across markets) with marketing mix variables such as prices, promotions, assortments, and competition while controlling for market and time specific trends, and differences in consumers shopping at different formats. Based on data from four product categories in the Nielsen homescan panel, we consistently find that value brands perform better at Walmart supercenters, while premium brands perform better at supermarkets. We find substantial differences in assortments carried at Walmart supercenters and supermarkets. On average, assortment explains 30% of the variation in relative brand shares while prices and promotions explain 24% of the variation. Importantly, this pattern persists among consumers not loyal to either format i.e., who split their spending at ...

Point-of-Sale Marketing Mix and Brand Performance - The Moderating Role of Retail Format and Brand Type
Date Posted:Wed, 25 Nov 2015 18:02:49 -0600
In this paper, we study the role of point-of-sale (POS) marketing mix variables in explaining variation in brand shares (i) at different retail formats, and (ii) across national and store brands in different price tiers. Stores in different retail formats differ in their positioning, the clientele they attract, and types of shopping trips made to the store. Further, national and store brands in different price tiers differ in the quality perception, and the contracts between the retailer and the manufacturer. Together, this implies that POS variables may influence brand shares very differently in different retail formats and for different brand types, which has important implications for retailers and manufacturers. We use Nielsen store level data from 2011-2014 and analyze the top ten spending product categories spreading across four product departments - dry grocery, non-food grocery, dairy and frozen, and across four retail formats - convenience stores, drug stores, supermarkets and mass merchandisers. In order to draw generalizations across categories, rather than study a subset of brands in each category, we classify national and store brands into ?premium?, ?value? and ?economy? brands and study the relative drivers of choices of brands in these groups. Consistent with the theoretical predictions, we find that brand shares at convenience stores are least sensitive to price changes, and most sensitive to changes in assortment (number of sizes and number of variants per s

REVISION: Brand Performance Across Store Formats: Beyond Walmart's Low Prices
Date Posted:Wed, 25 Nov 2015 08:02:49 -0600
We study whether certain types of brands are more likely to perform better at Walmart supercenters as compared to supermarkets. We correlate the variation in brand sales performance at these two store formats (over time and across markets) with marketing mix variables such as prices, promotions, assortments, and competition while controlling for market and time specific trends, and differences in consumers shopping at different formats. Based on data from four product categories in the Nielsen homescan panel, we consistently find that value brands perform better at Walmart supercenters, while premium brands perform better at supermarkets. We find substantial differences in assortments carried at Walmart supercenters and supermarkets. On average, assortment explains 30% of the variation in relative brand shares while prices and promotions explain 24% of the variation. Importantly, this pattern persists among consumers not loyal to either format i.e., who split their spending at ...

New: Food Purchases During the Great Recession
Date Posted:Sat, 11 Jul 2015 06:21:25 -0500
Using the Nielsen Homescan data, we describe what happened to household purchase behavior during the Great recession (Dec 2007-June 2009). Our specific objectives in this study are to understand how the recession impacted: households’ grocery spending in a broad cross-section of 31 food categories; prices paid and quantities bought by households in these categories; the types of outlets they made purchases in; the composition of the food basket in the choice of more expensive brands and less expensive brands and private label products; product volume purchased with retailer discounts and coupons; and, whether there were differences in these behaviors across different demographic groups. We find that during the recession, households purchased more in these food categories, and substituted to cheaper outlets and items sold on deal. However, contrary to expectations, we do not find evidence that the recession was the primary driver behind the increases in store brand share and coupon ...

New: Food Purchases During the Great Recession
Date Posted:Tue, 17 Feb 2015 06:14:31 -0600
Using the Nielsen Homescan data, we describe what happened to household purchase behavior during the Great recession (Dec 2007-June 2009). Our specific objectives in this study are to understand how the recession impacted: households’ grocery spending in a broad cross-section of 31 food categories; prices paid and quantities bought by households in these categories; the types of outlets they made purchases in; the composition of the food basket in the choice of more expensive brands and less expensive brands and private label products; product volume purchased with retailer discounts and coupons; and, whether there were differences in these behaviors across different demographic groups. We find that during the recession, households purchased more in these food categories, and substituted to cheaper outlets and items sold on deal. However, contrary to expectations, we do not find evidence that the recession was the primary driver behind the increases in store brand share and coupon ...

New: Food Purchases During the Great Recession
Date Posted:Thu, 05 Feb 2015 10:36:16 -0600
Using the Nielsen Homescan data, we describe what happened to household purchase behavior during the Great recession (Dec 2007-June 2009). Our specific objectives in this study are to understand how the recession impacted: households’ grocery spending in a broad cross-section of 31 food categories; prices paid and quantities bought by households in these categories; the types of outlets they made purchases in; the composition of the food basket in the choice of more expensive brands and less expensive brands and private label products; product volume purchased with retailer discounts and coupons; and, whether there were differences in these behaviors across different demographic groups. We find that during the recession, households purchased more in these food categories, and substituted to cheaper outlets and items sold on deal. However, contrary to expectations, we do not find evidence that the recession was the primary driver behind the increases in store brand share and coupon ...

The Optimal Choice of Promotion Vehicles: Front-Loaded or Rear-Loaded Incentives?
Date Posted:Wed, 21 Jan 2015 18:59:23 -0600
We examine the key factors that influence a firm's decision whether to use front-loaded or rear-loaded incentives. When using price packs, direct mail coupons, FSI coupons or peel-off coupons, consumers obtain an immediate benefit upon purchase or a front-loaded incentive. However, when buying products with in-pack coupons or products affiliated with loyalty programs, promotion incentives are obtained on the next purchase occasion or later, i.e., a rear-loaded incentive. Our analysis shows that the innate choice process of consumers in a market (variety-seeking or inertia) is an important determinant of the relative impact of front-loaded and rear-loaded promotions. While in both variety-seeking and inertial markets, the sales impact and the sales on discount are higher for front-loaded promotions than for rear-loaded promotions, from a profitability perspective, rear-loaded promotions may be better than front-loaded promotions. We show that in markets with high variety-seeking it is more profitable for a firm to rear-load, and in markets with high inertia it is more profitable to front-load. Model implications are verified using two empirical studies: (a) a longitudinal experiment (simulating markets with variety-seeking consumers and inertial consumers) and (b) market data on promotion usage. The data in both studies are consistent with the model's predictions.

New: The Optimal Choice of Promotion Vehicles: Front-Loaded or Rear-Loaded Incentives?
Date Posted:Wed, 21 Jan 2015 08:59:24 -0600
We examine the key factors that influence a firm's decision whether to use front-loaded or rear-loaded incentives. When using price packs, direct mail coupons, FSI coupons or peel-off coupons, consumers obtain an immediate benefit upon purchase or a front-loaded incentive. However, when buying products with in-pack coupons or products affiliated with loyalty programs, promotion incentives are obtained on the next purchase occasion or later, i.e., a rear-loaded incentive. Our analysis shows that the innate choice process of consumers in a market (variety-seeking or inertia) is an important determinant of the relative impact of front-loaded and rear-loaded promotions. While in both variety-seeking and inertial markets, the sales impact and the sales on discount are higher for front-loaded promotions than for rear-loaded promotions, from a profitability perspective, rear-loaded promotions may be better than front-loaded promotions. We show that in markets with high variety-seeking it is ...

Food Purchases During the Great Recession
Date Posted:Wed, 14 Jan 2015 15:43:54 -0600
Using the Nielsen Homescan data, we describe what happened to household purchase behavior during the Great recession (Dec 2007-June 2009). Our specific objectives in this study are to understand how the recession impacted: households? grocery spending in a broad cross-section of 31 food categories; prices paid and quantities bought by households in these categories; the types of outlets they made purchases in; the composition of the food basket in the choice of more expensive brands and less expensive brands and private label products; product volume purchased with retailer discounts and coupons; and, whether there were differences in these behaviors across different demographic groups. We find that during the recession, households purchased more in these food categories, and substituted to cheaper outlets and items sold on deal. However, contrary to expectations, we do not find evidence that the recession was the primary driver behind the increases in store brand share and coupon share observed during the recessionary period.

New: Food Purchases During the Great Recession
Date Posted:Wed, 14 Jan 2015 05:43:55 -0600
We look at the Nielsen Homescan data to describe what happened during the Great recession (Dec 2007-June 2009). Our specific objectives in this study are to determine how the recession impacted: grocery spending in a broad cross-section of 31 food categories; prices paid and quantities bought by consumers in these categories; the selection of type of outlets to make purchases in; the composition of the food basket in the choice of private label versus national brand purchases; product volume bought with retailer discounts and coupons; whether there were differences in behavior across different demographic groups.

REVISION: Competitive Consequences of Using a Category Captain
Date Posted:Wed, 28 Sep 2011 18:13:36 -0500
Many retailers designate one national brand manufacturer in each product category as a “category captain” to help manage the entire category. A category captain may perform demand-enhancing services such as better shelf arrangements, shelf-space management, and design and management of in-store displays. In this paper, we examine when and why a retailer may engage one manufacturer exclusively as a category captain to provide such service and the implications. We find that demand ...

REVISION: Competitive Consequences of Using a Category Captain
Date Posted:Mon, 19 Sep 2011 18:11:42 -0500
Many retailers designate one national brand manufacturer in each product category as a “category captain” to help manage the entire category. A category captain may perform demand-enhancing services such as better shelf arrangements, shelf-space management, and design and management of in-store displays. In this paper, we examine when and why a retailer may engage one manufacturer exclusively as a category captain to provide such service and the implications. We find that demand ...

Competitive Consequences of Using a Category Captain
Date Posted:Mon, 19 Sep 2011 00:00:00 -0500
Many retailers designate one national brand manufacturer in each product category as a ?category captain? to help manage the entire category. A category captain may perform demand-enhancing services such as better shelf arrangements, shelf-space management, and design and management of in-store displays. In this paper, we examine when and why a retailer may engage one manufacturer exclusively as a category captain to provide such service and the implications. We find that demand substitutability of competing brands gives rise to a service efficiency effect ? service that expands the category is more effective in increasing a manufacturer?s sales and margin than service that shifts demand from a rival?s brand. We show that the service efficiency effect may motivate a category captain to provide a service that benefits all brands in the category even though doing so is more costly. We further show that, in categories that are less price competitive, there is higher competition between manufacturers to become the category captain. Consequently, a retailer may obtain better service by using a category captain than by engaging both manufacturers simultaneously. Our findings may help explain why a retailer may rely on a category captain despite concerns regarding opportunism and why there is limited empirical evidence of harm to rival manufacturers.

New: Brand History, Geography, and the Persistence of Brand Shares
Date Posted:Wed, 11 Feb 2009 19:49:35 -0600
We study persistence in the geographic variation in market shares of branded goods in consumer packaged goods industries across 50 U.S. city-markets. We match scanner data on local market shares and survey data on local quality perceptions for the largest brands in 34 consumer packaged goods industries. These data are then matched with historic information on the year and US city-market in which each brand was first launched. We find that these consumer brands have persistently higher market ...

New: Brand History, Geography, and the Persistence of Brand Shares
Date Posted:Sun, 23 Nov 2008 17:23:32 -0600
We study persistence in the geographic variation in market shares of branded goods in consumer packaged goods industries across 50 U.S. city-markets. We match scanner data on local market shares and survey data on local quality perceptions for the largest brands in 34 consumer packaged goods industries. These data are then matched with historic information on the year and US city-market in which each brand was first launched. We find that these consumer brands have persistently higher market ...

Brand History, Geography, and the Persistence of Brand Shares
Date Posted:Mon, 29 Sep 2008 17:43:25 -0500
We study persistence in the geographic variation in market shares of branded goods in consumer packaged goods industries across 50 U.S. city-markets. We match scanner data on local market shares and survey data on local quality perceptions for the largest brands in 34 consumer packaged goods industries. These data are then matched with historic information on the year and US city-market in which each brand was first launched. We find that these consumer brands have persistently higher market shares in markets closest to their respective cities-of-origin than in markets farthest from their respective cities-of-origin, where they were typically launched later. For 6 of the 34 industries, we collected more complete historic entry data with which we can determine the local order of entry among the top brands in each of the 50 U.S. city-markets. We find a persistent effect from differences in the order-of-entry of competing brands on their current relative brand shares and quality perceptions across US cities. The historic order of entry also appears to correlate with the current rank-order of brand shares across cities, leading to large asymmetries across markets in brand shares and in quality perceptions. This persistence is particularly striking since many of the brands studied herein originated during the mid-to-late 19th and early 20th centuries, roughly a century prior to the sample period of the market share and quality perception data.

New: Brand History, Geography, and the Persistence of Brand Shares
Date Posted:Mon, 29 Sep 2008 08:13:39 -0500
We study persistence in the geographic variation in market shares of branded goods in consumer packaged goods industries across 50 U.S. city-markets. We match scanner data on local market shares and survey data on local quality perceptions for the largest brands in 34 consumer packaged goods industries. These data are then matched with historic information on the year and US city-market in which each brand was first launched. We find that these consumer brands have persistently higher market ...

Endogenous Sunk Costs and the Geographic Distribution of Brand Shares in Consumer Package Goods Indu
Date Posted:Thu, 20 Jan 2005 10:58:01 -0600
This paper describes industrial market structure in consumer package goods (CPG) industries using a unique database spanning 31 industries and the 50 largest US metropolitan markets. A general set of stylized facts is documented pertaining mainly to the geographic patterns in brand shares. A connection between the patterns and a model of endogenous sunk costs in advertising is established by testing several predictions of the theory. We establish that concentration is bounded below in ...

Market Structure and the Geographic Distribution of Brand Shares in Consumer Package Goods Industries
Date Posted:Thu, 20 Jan 2005 00:00:00 -0600
We describe industrial market structure using a unique database spanning 31 consumer package goods (CPG) industries, 39 months, and the 50 largest US metropolitan markets. We organize our description of market structure around the notion that firms can improve brand perceptions through advertising investments, as in Sutton's endogenous sunk cost theory. In the data, observed advertising levels escalate (i.e. larger brands) in larger markets while the number of advertised brands within an industry remains stable. Correspondingly, observed concentration levels in advertising-intensive industries are bounded away from zero irrespective of market size. For two industries, we collect historic order-of-entry data. The geographic distribution of entry is found to account for the levels, rank-orders and covariation in the geographic distribution of brand shares, perceived brand qualities and advertising effort. Interestingly, alternative potential sources of geographic asymmetry on both the supply and demand sides do not mimic the geographic patterns of shares. In general, our findings highlight several striking persistent geographic patterns in the industrial market structures of CPG industries.

The Role of Retail Competition, Demographics and Account Retail Strategy as Drivers of Promotional Sensitivity
Date Posted:Fri, 28 Nov 2003 19:45:12 -0600
We study the determinants of sensitivity to the promotional activities of temporary price reductions, displays, and feature advertisements. Both the theoretical and empirical literatures on price promotions suggest that retailer competition and the demographic composition of the shopping population should be linked to response to temporary price cuts. However, datasets that span different market areas have not been used to study the role of retail competition in determining price sensitivity. Moreover, little is known about the determinants of display and feature response. Very little attention has been focused on retailer strategic decisions such as price format (EDLP vs. Hi-Lo) or size of stores. We assemble a unique dataset with all U.S. markets and all major retail grocery chains represented in order to investigate the role of retail competition, account retail strategy, and demographics in determining promotional response. Previous work has not simultaneously modeled response to price, display, and feature promotions, which we do in a Bayesian Hierarchical model. We also allow for retailers in the same market to have correlated sales response equations through a variance component specification. Our results indicate that retail strategic variables such as price format are the most important determinants of promotional response, followed by demographic variables. Surprisingly, we find that variables measuring the extent of retail competition are not important in

The Role of Retail Competition, Demographics and Account Retail Strategy as Drivers of Promotional S...
Date Posted:Fri, 28 Nov 2003 09:45:12 -0600
We study the determinants of sensitivity to the promotional activities of temporary price reductions, displays, and feature advertisements. Both the theoretical and empirical literatures on price promotions suggest that retailer competition and the demographic composition of the shopping population should be linked to response to temporary price cuts. However, datasets that span different market areas have not been used to study the role of retail competition in determining price sensitivity.