Product Variety and Loyalty to National Brands – A Combined Measurement of Purchase Sequence and Coverage of Demand

Mona R. Springer-Norden (), Rainer Olbrich (), Philipp Brüggemann () and Carsten D. Schultz ()
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Mona R. Springer-Norden: Fern Universität in Hagen
Rainer Olbrich: Fern Universität in Hagen
Philipp Brüggemann: Fern Universität in Hagen
Carsten D. Schultz: Fern Universität in Hagen

A chapter in Advances in National Brand and Private Label Marketing, 2021, pp 1-11 from Springer

Abstract: Abstract The manufacturer brand industry is continuously faced with the challenge of retaining their current customers and acquiring new ones. Increasing brand loyalty can help to face these challenges and to compete in the market. In this paper, a combined behavioral approach to measure customer loyalty is presented and empirically analyzed using national brands (NBs) of chocolate bars. This innovative measurement integrates both concepts of purchase sequences and coverage of demand. The derived hypotheses are tested by a multilevel analysis using the pooled-OLS method. The negative effect of product prices of NBs on the number of loyal households is moderated by leading NBs (top 10). The higher the price of a leading NB, the lower the number of loyal households to this NB. In contrast to price, neither purchase frequency nor the number of competing NBs influence NBs loyalty of households. The positive influence of the NBs’ product variety is particularly strong compared to the other variables. Through the specific use of product variety, on the one hand, consumers with a high exploratory propensity can be bound to the NB. On the other hand, product variety can be used to attract and persuade new households to the NB.

Keywords: Customer retention; Household’s brand loyalty; Household panel data; Manufacturer brand industry; National brand (NB); Product variety (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:spr:prbchp:978-3-030-76935-2_1

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DOI: 10.1007/978-3-030-76935-2_1

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