The impact of retail format diversification on retailers’ financial performance

Yuying Shi (), Jeremy M. Lim (), Barton A. Weitz () and Stephen L. France ()
Additional contact information
Yuying Shi: Texas A & M University-Commerce
Jeremy M. Lim: University of Florida
Barton A. Weitz: University of Florida
Stephen L. France: Mississippi State University

Journal of the Academy of Marketing Science, 2018, vol. 46, issue 1, No 10, 147-167

Abstract: Abstract For retailers, format portfolio management is a core marketing operation, but has received little attention in the marketing literature. This study analyzes the relationship between format diversification and retailer performance in a global setting, where retailers as part of their geographic expansion process often employ format diversification. The dual strategies of geographic diversification and format diversification substantially complicate the diversification-performance relationship. Using a six year panel data set for leading global retailers, we find a positive impact for geographic diversification, a negative impact for format diversification and a negative interaction for the dual strategies, supporting a single focus diversification strategy. We further show the consistency of our findings using a series of model robustness checks.

Keywords: Retail format; Financial performance; Tobin’s Q; Diversification portfolio; Dynamic panel model (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (10)

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DOI: 10.1007/s11747-017-0559-0

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