Do feature and discount promotions for national brands primarily drive (national) brand choice, store choice, or both? An exploratory analysis

Jonne Guyt*, Els Gijsbrechts

*Corresponding author for this work

Research output: Chapter in Book/Report/Conference proceedingConference contributionScientificpeer-review

Abstract

Feature and discounts promotions are among the most frequently used marketing instruments in the consumer packaged goods (CPG) landscape. Using a flexible generalized extreme-value model, this study analyses the effect of national brand feature and discount promotions in a multi-retailer and multi-brand setting, in which households can use different decision routes to choose a (national or private label) brand and store. Across nine CPG categories, our results reveal that in each category a mixture of decision routes prevails: about 55% of households exhibiting a brand focus (i.e. primarily select a brand, and then choose between stores offering that brand), the remaining 45% showing evidence of a retailer focus (i.e. rather substituting brand offers within a visited store). These decision routes entail different patterns of competition between brands and stores, and come with differences in promotion response: feature ads triggering stronger (weaker) reactions among households with a brand (retailer) focus in almost all categories, and discount depth hardly affecting households with a retailer focus. As such, especially for less-frequently purchased categories, the brand-focus decision route leads to larger net promotion benefits for the retailer and, despite the stronger brand-cannibalization, even for the manufacturer. Managerial implications are discussed.

Original languageEnglish
Title of host publicationAdvances in National Brand and Private Label Marketing
EditorsFJ MartinezLopez, JC GazquezAbad, E Gijsbrecht
Place of PublicationCham
PublisherSPRINGER INT PUBLISHING AG
Pages97-101
Number of pages5
ISBN (Print)9783319399454
DOIs
Publication statusPublished - Jun 2016
Event3rd International Conference on Advances in National Brand and Private Label Marketing - Barcelona, Spain
Duration: 29 Jun 20161 Jul 2016

Publication series

NameSpringer Proceedings in Business and Economics
PublisherSPRINGER INT PUBLISHING AG
ISSN (Print)2198-7246

Conference

Conference3rd International Conference on Advances in National Brand and Private Label Marketing
CountrySpain
CityBarcelona
Period29/06/161/07/16

Keywords

  • Brand and store choice
  • Decision structures
  • National brand promotions
  • Feature ads
  • Discounts

Cite this

Guyt, J., & Gijsbrechts, E. (2016). Do feature and discount promotions for national brands primarily drive (national) brand choice, store choice, or both? An exploratory analysis. In FJ. MartinezLopez, JC. GazquezAbad, & E. Gijsbrecht (Eds.), Advances in National Brand and Private Label Marketing (pp. 97-101). (Springer Proceedings in Business and Economics). SPRINGER INT PUBLISHING AG. https://doi.org/10.1007/978-3-319-39946-1_12