Modeling multiple category brand preference with household basket data

Abstract

Household basket data contain important information about the structure of brand preferences both within and across product categories. This research exploits the information in long-run basket summary data to segment consumers with respect to brand preferences. The approach provides insights into the competitive structure of brands within each product category and identifies potential synergies across product categories. The model is applied in an analysis of retailer and national brand name preferences for four paper goods categories. We discuss implications for joint promotion, product bundling and product assortment decisions.