Where is the brand growth potential? An examination of buyer groups

Giang Tue Trinh (), John Dawes and Byron Sharp
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Giang Tue Trinh: University of South Australia
John Dawes: University of South Australia
Byron Sharp: University of South Australia

Marketing Letters, 2024, vol. 35, issue 1, No 7, 95-106

Abstract: Abstract Practitioners and academics have long discussed strategies for brand sales growth. A recent example is an industry debate in which different brand growth strategies were argued: https://www.mmaglobal.com/thegreatdebate (MMA Global & Neustarr, 2021). A central question in this arena is whether a brand should focus on its heavy, light, or non-buyers in its efforts to grow its sales. This study contributes to our knowledge about how sales growth can occur by investigating the potential contribution these three buyer groups can make to any sales gain. Using both, a simulation study and an empirical study of purchases of approximately 12,400 households in the UK, across different brands and categories, we show that almost any brand’s headroom growth potential lies mostly in light or non-buyers of that brand. Even for large brands with high penetration the growth potential of light brand buyers eclipses heavy brand buyers.

Keywords: Marketing strategy; Brand growth; Pareto share; Dirichlet model; Heavy buyers (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s11002-023-09682-7

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