Brand growth in packaged goods markets: Ten cases with common patterns

Abstract

AbstractThe study examines 10 consumer goods brands that grew market share year on year, to identify if there are commonalities in the way that key brand performance metrics change during growth. The study uses consumer panel data from the UK and USA. Ten brands in a range of categories are examined. Brand metrics of penetration, repeat‐purchase loyalty, cross‐purchasing by other brand's buyers, the distribution of purchase frequency, and the brand's market share within buyer subgroups are analyzed. The principal findings are as follows: (1) as these brands grew, brand penetration increased far more than repeat‐purchase loyalty on average; (2) the most apparent change in the buyer base was the big increase in light or infrequent buyers; (3) they induced more cross‐purchasing from most or all other competitor brands' buyers; and (4) they grew their market share in all buyer demographic groups. Implications are that brand growth strategies should be geared towards enlarging the size of the customer base, with less emphasis on boosting loyalty. The results also suggest that specifically targeting certain sorts of buyers may be counterproductive. These findings challenge traditional assumptions in relation to brand growth and success. Copyright © 2016 John Wiley & Sons, Ltd.