International transfer and perception of retail formats

Abstract

Purpose– The purpose of this paper is to emphasize the important but neglected role of retail formats in the transfer and positioning decisions of international retailers. The paper examines the role of core and country-specific attributes of particular formats in determining retailers’ local positioning in inter-format competition.Design/methodology/approach– Focussing on three distinguished grocery formats (i.e. discounters, supermarkets, and hypermarkets) and using multiple-group structural equation models, the authors conducted consumer surveys in Germany and Romania to evaluate consumer perceptions of the core attributes of those formats and their influence on retail brand equity and consumer loyalty.Findings– Although consumer perceptions of core attributes differ between formats in Germany and Romania, most of the core attributes of the formats affect retail brands with equal strength in both markets. Retail brand equity determines loyalty to all formats in both countries.Research limitations/implications– Retailers transferring their formats to foreign countries should place particular emphasis on managing the core attributes of a specific format, as these attributes are of paramount importance in establishing a strong brand. Additional country-specific attributes are also relevant to varying extents, depending on the particular format that is used. Assessing causal relationships extends retailer knowledge of the role of format attributes.Originality/value– This study proposes a format-specific approach that is novel to international retailing research. The country comparison strengthens the study's implications, considers both a developed and an emerging economy, and accounts for the preference of Western European retailers to expand into Eastern European countries. The paper concludes that format transfer and positioning decisions occur within the boundaries of core format attributes.