A New Method of Constructing Brand Switching Matrix

Abstract

A new method of defining brand switching is introduced. Brand switching is defined by comparing two brands purchased in two consecutive periods. For durable consumer goods this does not cause any problem, because only one brand would be purchased in one period. It is difficult to define brand switching of non-durable consumer goods in the same manner, because two or more brands can be purchased by a consumer in one period. A practical method to cope with this difficulty is to compare the best selling brand in each period, but this ignores brands other than the best selling brand. The present method defines brand switching by the change of the rank of the purchase amount of the brand in two consecutive periods. The method is applied to derive the brand switching matrix among potato snack brands, and is compared with the method based on the best selling brand by asymmetric multidimensional scaling. The comparison shows that the present method represents the dominance relationships among brands more accurately than the method based on the best selling brand.