Measures of store loyalty in French food retailing

Fabian Bergès (fabian.berges@toulouse.inra.fr) and Valérie Orozco (valerie.orozco@inrae.fr)
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Fabian Bergès: Toulouse School of Economics GREMAQ-INRA and IDEI - Manufacture des Tabacs - MA 103, 21 Allée de Brienne, F-31000 Toulouse, France

Review of Agricultural and Environmental Studies - Revue d'Etudes en Agriculture et Environnement, 2010, vol. 91, issue 3, 261-277

Abstract: Store loyalty is an important issue for retailers since it defines one way in which consumers are attached to stores. However, store loyalty is not unidimensional and there are different ways of measuring it. After surveying the marketing literature on how to assess ’store loyalty’, we compute different store loyalty indexes with French homescan database on consumer purchases (9 000 households) coupled with a store database that allows us to control for supply parameters, including store location and accessibility. We find that the store loyalty index, computed on more than 250 goods, differs greatly across chain stores. Moreover, when households increase their expenditures in a store, it does not necessarily mean that the store benefits from more loyal patronage. We also investigate the relationship between store loyalty and likelihood of buying private labels (PL). Results show that a PL expenditure increase does not translate into higher store loyalty (whatever the index studied).

Keywords: store loyalty; market power; private label (search for similar items in EconPapers)
JEL-codes: D1 D3 L1 Q13 (search for similar items in EconPapers)
Date: 2010
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