Brand Loyalty and Marketing Strategy: An Application to Home Appliances

Abstract

In the academic literature, the modelling of brand choice and switching behavior has a long history for frequently purchased packaged goods. Comparable efforts with consumer durable goods, however, are generally absent. This paper presents an application of the brand switching model proposed by Colombo and Morrison (1989) to a set of four major home appliances. Appliance brand loyalty, however, is shown to be a function of the timing of replacements, a factor that has not entered into the modelling of packed goods. As a result, the brand switching matrices are analyzed over the replacement cycle. This application illustrates how a brand switching analysis can be used to assess the relative competitive position of a firm in terms of the primary customer sources that a brand attracts.