Product Category Characteristics Research Articles

How Can Price Promotions Make Consumers More Interested? An Empirical Study from a Chinese Supermarket

Price promotions are commonly employed to enhance supermarket performance and the sustainable development of the retail industry, yet their effectiveness may vary among similar supermarket chains. In contrast to Western countries, Chinese supermarkets are typically community-centered, allowing consumers to make frequent visits due to lower transaction costs. This multiple-visit pattern discourages substantial one-time purchases based on promotions. This study aims to investigate how pricing promotions can attract consumers more effectively and which product categories are most suitable for this purpose. Utilizing scanner data from Chinese chain supermarkets, we empirically assess the impact of promotion depth, breadth, and duration on consumer purchasing behavior using fixed effects models, IV, and GMM methods. Furthermore, we identify product category characteristics that are more appealing to consumers based on the relationships between different product category promotions and consumer behavior. Results demonstrate that each of the three price-promotion features has a positive effect on Chinese supermarket performance, with varying degrees of significance. Different promotion methods not only benefit promoted products but also stimulate sales of non-promotional items. At the product level, the impact of supermarket promotions on performance differs across categories. The most attractive category in terms of consumer purchases influenced by discounts is special paper, while small kitchen appliances have the least impact. Promoting categories with lower average prices, higher average sales volumes, fewer products, and better storage durability is conducive to attracting consumer shopping. These empirical findings have implications for academic research on price promotion theory and supermarket managers’ pricing strategy decisions, as well as the sustainable development of the offline retail industry.

Follow your nose when it sounds right: How brand names influence consumer responses to product scents

Product scents exert a considerable influence on managerial outcomes. However, little research has examined the contextual circumstances that facilitate or hinder consumer responses to product scents. Across three studies, we address this gap by exploring how one important product element –brand name congruence – moderates the influence of product scent valence on consumer responses. Specifically, we find that brand names that are phonetically incongruent with desirable product category characteristics attenuate the effect of a product scent’s valence on consumers’ evaluations and purchase decisions. Conversely, a product scent’s valence plays a significant role in shaping consumers’ responses when the product’s brand name is phonetically congruent with desirable product category characteristics. This research has important implications for marketers who want to exploit favorable product scents, and for those who wish to reduce consumer attention to unappealing product odors.

The role of market and product category characteristics in local versus foreign language branding in Latin America

PurposeThis paper explores which market and product category characteristics could influence the use of foreign language brand names (i.e. whether a brand uses a foreign language versus local language brand name) in some of the largest Latin American countries.Design/methodology/approachHypotheses are tested using 880 brands from 39 product categories and nine Latin American markets using a hierarchical logistic regression.FindingsResults revealed that foreign language brand names are more likely to be used in product categories related to local infrastructure, high-tech and global community. In contrast, local language brand names are more likely to be used in product categories associated to subscriptions. Findings also suggest that Hofstede's national cultural dimensions are significant factors. Finally, the results revealed that foreign language brand names are more likely to be used in markets with a low level of foreign language proficiency.Originality/valueThis paper shows the importance of considering market and product category characteristics and their potential influence on local versus foreign language branding in Latin America – an ignored issue in previous research.

The impact of weather on consumer behavior and retail performance: Evidence from a convenience store chain in China

Despite extensive use of weather data to adjust replenishment and inventory strategies in the retail industry, these companies do clearly know the effect of weather on consumer behavior and retail performance. How does weather affect consumers' purchasing behavior and thus retail performance? We study empirically these questions by analyzing more than 6 million transactions made by more than 1.62 million unique consumers at 146 convenience stores in a convenience store chain in China. We choose sun, rain, temperature, and air quality index as the main weather variables. We use the average number of items per order and the average price of each item in each order as indicators of consumer behavior, and use store daily sales as an indicator of retail performance. We found that under rainy weather, people will buy more products with higher item prices in one order. When temperature rises, people will buy fewer products with a lower item price in one order. In addition, sunny weather and rainy weather have a positive impact on daily sales than cloudy weather. Air quality has a negative impact on daily sales, while temperature has a positive impact on sales. Finally, we study the impact of weather on different product categories. We find that the results depend on the product category characteristics.

The Impact of Mobile App Adoption on Cross-buying: The Moderating Roles of Product Category Characteristics and Adoption Timing

With more and more companies introducing mobile apps and consumers using them during the purchase journey, it is increasingly important to understand the consequences of app adoption on behavioral outcomes. This paper investigates the impact of app adoption on the number of additional products purchased by customers (i.e., cross-buying) and how this effect varies across different product categories and different customers. We focus on two key product category characteristics (utilitarian vs. hedonic nature and perceived risk) and on adopters who vary in their adoption timings (early vs. late adopters). Using data from an online retailer and a combination of propensity score weighting with difference-in-differences and Heckman correction estimation techniques, the results show that app adoption has a positive effect on cross-buying overall, but the effect varies greatly across products and consumers. App adoption promotes additional product purchases for hedonic products but leads to less cross-buying for utilitarian products. In addition, early adopters purchase a higher number of additional product categories than late adopters, with this difference decreasing over time and for new consumers compared to existing customers. These results offer novel insights into the behavioral consequences of app adoption and provide managers with useful recommendations for improving the effectiveness of their mobile app investments.

Loyalty cards, credit options and economic market development

PurposeThis paper analyses three strategies in customers’ use to afford consumption in a developed and an emerging market for different product groups. The strategies are: (1) usage of loyalty cards, (2) usage of credit cards and (3) usage of long-term credits.Design/methodology/approachMall intercept surveys conducted in Poland (emerging market) and Germany (developed market) provide data for testing a set of hypotheses using ANOVAs.FindingsResults show that customers in emerging markets show no differences in the usage of loyalty cards for product categories with high shopping frequency (groceries) compared to developed markets, while in all other product categories loyalty card usage is stronger. Results show further that in low price categories, customers in emerging markets use credit card payments more often compared to customers in developed markets. In high price categories, they use credit cards less often, but long-term credits more often.Research limitations/implicationsResults have implications for the design of loyalty programs and payment options in different markets. Results have also implications for public policy regarding concerns about increasing private debt in emerging countries.Originality/valueThis paper suggests a cost-benefit framework where customers in emerging countries perceive benefits of loyalty cards and credit options higher, while they are willing to bear higher costs. As a result, effects of product category characteristics on usage that are observable in developed markets do not exist in emerging markets.

Taking a closer look: Reasserting the role of self-accountability in ethical consumption

Recent studies have repeatedly reported the frustrating intention–behavior gap in which consumers do not “walk their talk” in the ethical consumption context. Peloza, White, and Jingzhi (2013) find that heightening consumers’ self-accountability enhances their preferences for products positioned using ethical attributes. This study replicates, refines, and extends the original work of Peloza et al. (2013) in three ways. We challenge the findings of Peloza et al. (2013) (1) with more representative samples (i.e., real consumers), (2) with online and field experimental approaches, and (3) across different national cultures (collectivistic vs. individualistic) and product types (utilitarian vs. hedonic). Moreover, this study advances the previous research by identifying specific advertisement design factors (i.e., color and message framing) and contextual factors (i.e., product category characteristics) as boundary conditions of the self-accountability effect on consumers’ responses to products promoted using ethical appeals.

Effects of country-of-origin stereotypes on consumer responses to product-harm crises

PurposeThe purpose of this paper is to investigate “how” and “when” the stereotypes of competence and warmth, that are evoked by a foreign company’s country-of-origin (COO), affect blame attributions and/or attitudes toward a company’s products when a company is involved in a product-harm crisis.Design/methodology/approachStudy 1 (n=883) analyzes the psychological mechanisms through which perceived COO competence and warmth differently affect blame attributions and evaluative responses. Study 2 (n=1,640) replicates Study 1’s findings, and it also investigates how consumer ethnocentrism, animosity toward a country, and product category characteristics moderate the hypothesized COO’s effects.FindingsCOO competence leads to more favorable attitudes toward the involved company’s products. This effect increases when the company sells high-involvement or utilitarian products. COO warmth leads to more favorable attitudes toward the involved company’s products directly as well as indirectly by diminishing blame attributions. These effects increase when consumers are highly ethnocentric, or the animosity toward a foreign country is high.Originality/valueThis paper frames the investigation of COO stereotypes in a new theoretical and empirical setting, specifically, a product-harm crisis. It demonstrates that consumers differently evaluate a potential wrongdoing company and its harmful products in a product-harm crisis based on their perceptions of a company’s COO competence and warmth. Finally, it defines the moderating effects of individual, consumer-country-related and product characteristics on the hypothesized COO effects.

Drivers of private-label purchase behavior across quality tiers and product categories

Private labels hold a substantial share of consumers’ wallets and their popularity is still growing as they spread into various product categories and quality tiers. To determine the right branding strategy, in terms of offering uniform or different private-label brands across product categories, retailers have to know whether consumers use their private-label experience across product categories and private-label tiers. Therefore, we examine different determinants of consumers’ consideration sets. We apply proneness for certain private-label tiers, product categories purchased, purchase frequency, and variety seeking as internal determinants, which contribute to consumers’ knowledge and experience with private labels. Further, we use consumers’ price consciousness and promotion sensitivity as external determinants, which the retailer can use to influence consumers’ consideration sets in the short run. Our analyses are based on large-scale loyalty program data for a period of 24 months. In particular, we use the first 12 months to derive the determinants of consumers’ share of wallets regarding different private-label quality tiers in the second half of the sample. We conduct our analyses for 12 different product categories and aggregate the results by using meta-analytic techniques. Notably, some determinants show dissimilar effects across product categories (e.g., price consciousness and promotion sensitivity), while others (e.g., private-label proneness) are rather similar. We find that consumers’ general proneness for certain private-labels tiers leads to a propensity to purchase them in a specific category and in adjacent quality tiers. Further, we reveal that product category characteristics moderate the determinants of private-label share.

How Kinetic Property Shapes Novelty Perceptions

This article demonstrates a new substantive finding: that kinetic property in advertising, defined as direction changes in the paths of moving on-screen ad elements, enhances consumer judgments of product novelty. Across six studies, the authors first outline an inference-based theory as to why the novelty-enhancing effect of kinetic property manifests: kinetic property generates impressions of how visually lively an ad is, which leads to inferences of product atypicality and, consequently, higher novelty judgments. Second, they demonstrate boundary conditions by showing that (1) the positive effect for kinetic property is evident with incremental (and not radical) innovations, (2) the effect dissipates when figure-ground contrast in the ad makes kinetic property less discriminable, (3) contextual adaptation to kinetic property can mitigate this effect, and (4) kinetic property enhances novelty judgments primarily when product category characteristics such as perceived market dynamism match with kinetic property–based executions. The authors offer substantive implications for firms marketing new products as well as for multimedia advertising.

DETERMINANTS OF THE SUCCESS OF GLOBAL AND LOCAL BRANDS IN LATIN AMERICA

ABSTRACTThe purpose of this paper is to address the issue of the implementation of global and local brands in Latin America by drawing on contingency theory to develop and test hypotheses relating to how product category characteristics affect the success of global and local brands in the region. Hypotheses are tested using data obtained from top brands rankings reported in five Latin American markets (Argentina, Brazil, the Caribbean and Central America, Chile and Mexico). The study design considers estimating a logistic regression on a binomial dependent variable measuring whether 475 top brands are global or local brands, with product category characteristics as independent variables. Results reveal that product categories related to subscriptions, local tastes, high-tech, and global citizenship do have an impact on the success of global and local brands in Latin America.

PRODUCT CATEGORY: A Success Determinant for Store Brands

This paper examines the influence of product category characteristics on attitude towards store brands (SB). Our aim is to uncover the extent to which change in category quality, category complexity, category familiarity and category risk explain attitude towards store brands and to identify the intermediary role that perceived category risk may play. This study presents the results of a quantitative and a confirmatory analysis conducted on two product categories (detergents and food products). The results confirm the ability of product category to predict attitude towards store brands. Inter-category differences have been noticed, which explain differences in store brands performance from one product category to another.

Are Multichannel Customers Really more Valuable? The Moderating Role of Product Category Characteristics

How does the monetary value of customer purchases vary by customer preference for purchase channels (e.g., traditional, electronic, multichannel) and product category? The authors develop a conceptual model and hypotheses on the moderating effects of two key product category characteristics—the utilitarian versus hedonic nature of the product category and perceived risk—on the channel preference–monetary value relationship. They test the hypotheses on a unique large-scale, empirically generalizable data set in the retailing context. Contrary to conventional wisdom that all multichannel customers are more valuable than single-channel customers, the results show that multichannel customers are the most valuable segment only for hedonic product categories. The findings reveal that traditional channel customers of low-risk categories provide higher monetary value than other customers. Moreover, for utilitarian product categories perceived as high (low) risk, web-only (catalog- or store-only) shoppers constitute the most valuable segment. The findings offer managers guidelines for targeting and migrating different types of customers for different product categories through different channels.

Situational variables in online versus offline channel choice

Since the advent and rapid diffusion of the Internet, the subject of consumer channel choice has attracted a large amount of research, mainly focused on the influence of channel, consumer and product category characteristics as its drivers. The interaction between channel choice and the purchase situation has been largely ignored, however. This paper is an attempt to fill this gap by identifying the key purchase situation variables and conducting an experiment to assess their impact on the choice between the traditional retail outlet and the online store. The results show that the key determinants of channel choice relate to time and distance. Distance-to-store and time pressures are among the factors affecting the probability of online purchase. Using a conceptual framework to explore differences in the impact of situational variables across product categories (high/low involvement, search/experience good), we show that distance-to-store has more influence on the likelihood of online purchase in situations involving search goods, while social variables are found to play a role only in the context of high-involvement goods.

Keyword Search Advertising Response Model with Considering Product Category Characteristics

Keyword Search Advertising Response Model with Considering Product Category Characteristics

How Valuable are Multichannel Customers? The Moderating Effects of Product Category on the Relationship between Channel Preference and Monetary Value

How does the monetary value of customer purchases vary by customer preference for purchase channels (e.g., catalog, store, Web, multichannel) and product category? We develop a conceptual model and hypotheses about the moderating effects of two key product category characteristics -- hedonic versus utilitarian nature of the product category and perceived risk -- on the channel preference-monetary value relationship. We test these hypotheses using two different studies, comprising a unique large scale empirically generalizable dataset and a timeseries cross-sectional dataset. Contrary to conventional wisdom that all multichannel customers are more valuable than single channel customers, our results show that multichannel customers are the most valuable segment only for hedonic product categories. They reveal that for utilitarian product categories perceived as high (low) risk, ‘Web (catalog or store) only’ shoppers constitute the most valuable segment. Our findings offer managers guidelines for targeting and migrating different types of customers for different product categories through different channels.

Una comparación del comportamiento del consumidor en los canales online y offline: sensibilidad al precio, lealtad de marca y efecto de las características del producto

This paper investigates online and offline consumer choice behavior. Empirical research comparing online and offline consumer behavior has traditionally been based on comparisons between different sets of consumers, and therefore has been unable to isolate the effect of the Internet on consumer behavior from consumer-specific effects. Using online and offline grocery shopping data from the same sample of consumers, we show that consumer choice behavior differs across the two channels. When shopping online, consumers are less price-sensitive, while displaying stronger brand and size loyalty. In addition, results show that product category characteristics play a role in these differences. The price effect differences are greater in sensory and food categories, whereas the differences in brand loyalty effects are stronger in sensory and, surprisingly, non-food categories. These results should help firms to design better online business strategies.

Functional forms of the satisfaction–loyalty relationship

The linear functional form of the effect of customer satisfaction on repurchase intentions may not be adequate under all circumstances; however, we lack a clear understanding of the factors that may drive variation in the functional forms of the satisfaction–loyalty relationship. Building on existing research, the authors consider how the functional form of the effect of satisfaction on repurchase intentions varies across segments formed at the intersection of product categories and customer economic and demographic variables. A comprehensive data set obtained from the sponsors of the Chinese Customer Satisfaction Index provides the input for a flexible cubic regression configuration to model the functional forms. The linear functional form emerges as the most prominent across 972 product–customer segments (51%), followed in frequency by the S-shaped and convex forms and, finally, the inverse S-shape and concave forms. Different product category characteristics, customer economic and demographic variables, and market characteristics moderate the effect of satisfaction on repurchase intentions differently for the linear, quadratic, and cubic terms. This research reveals key resource allocation implications based on the functional forms of the effect of satisfaction on repurchase intentions, as well as strategic segmentation implications related to the varying influence of product category characteristics, customer economic and demographic variables, and market characteristics.

The Internet as a Shopping Channel and Database Description: An Empirical Application to Online Grocery Shopping

This paper (Chapter 1 of a dissertation on online and multichannel shopping behavior) provides a comprehensive knowledge of the characteristics, circumstances and shopping behaviors around online shopping, and more concretely, online grocery shopping, what seems to be the first milestone for every retailer who attempts to operate across online and offline channels and therefore become a multi-channel retailer. The chapter primarily emphasizes the fact that online and offline channels have their own advantages against the other, that the profile of consumers who usually purchase from them differ, and that not all products are equally suited to be commercialized online. Multichannel retailers should consider these issues while designing their marketing strategies across online and offline channels to be successful at both of them. In this sense, some interesting business strategies to induce the use of the online channel and improve its profitability are proposed also in the chapter. We unique data set of online and offline grocery purchases from the same sample of consumers of a large multichannel grocery chain. This chapter has two clear parts. In the first part, we present an overview of the Internet and the electronic commerce, providing evidence of its current importance and potential. We analyze the unique characteristics of the Internet in comparison with the offline channel, what consequently shows its advantages and disadvantages as a shopping channel, and its a priori better or worse suitability to commercialize certain types of products. In addition, we characterize the profile of the typical online shopper and examine the increasing importance of commercial activities in the online channel all over the world. In the second part, we concentrate on the grocery industry. Grocery shopping accounts for an important share of consumer’s total spending and its purchase in the online channel represents an interesting opportunity for retailers. In this part, our aim is to analyze the purchase of groceries online from a theoretical and an empirical approach. On the one hand, we theoretically examine the reasons that may drive or stop consumers to purchase groceries online. On the other hand, we examine, by means of an exploratory study, the factors that influence consumers to purchase groceries online, when to shop groceries online and the type of grocery products bought in this channel. Meantime, we describe the dataset which will be used in the remaining chapters of the dissertation and which is also used to address these research questions. The chapter closes with a summary and the conclusions from the two parts. Regarding consumer characteristics, we find that that the younger the primary shopper in a household, the more adults in it, the further away it is to the closest offline store with parking and the further away it is to the closest offline store with home-delivery, the more intensively it purchases online. In addition, male-headed households are found to be more likely to shop online than female-headed households. Besides, households who got the grocer’s fidelity card after the opening of the online store are found to purchase more intensively online, than those who did it before. Finally, we observe a negative correlation between the number of trips the households do and their online shopping intensity. Regarding purchase circumstances, the analysis reveals that online shopping is better chosen when it is cold, during weekdays and when households purchase big baskets. Regarding product category characteristics, results show that a grocery category is more likely to be shopped online if it is a CPG (Consumer Packaged Good), it is a non-food category, it is bulky, it is a liquid, it is heavy and has an important share of private label sales. Chapter 1 provides a comprehensive knowledge of the characteristics, circumstances and shopping behaviors around online shopping, and more concretely, online grocery shopping, what seems to be the first milestone for every retailer who attempts to operate across online and offline channels and therefore become a multi-channel retailer. The chapter primarily emphasizes the fact that online and offline channels have their own advantages against the other, that the profile of consumers who usually purchase from them differ, and that not all products are equally suited to be commercialized online. Multichannel retailers should consider these issues while designing their marketing strategies across online and offline channels to be successful at both of them. In this sense, some interesting business strategies to induce the use of the online channel and improve its profitability are proposed also in the chapter.

A Conjoint‐Hazard Model of the Timing of Buyers' Upgrading to Improved Versions of High‐Technology Products*

Understanding consumers' upgrading behavior is essential to product planning. Product managers would like to know what fraction of customers would upgrade to new and improved versions, and how fast. This paper presents a method to forecast the sales path of an improved version of a high‐technology product defined in terms of its price path and multiattribute product specification. The approach is potentially useful to managers to answer what‐if questions on the effects of alternative price paths and product specifications of the upgrade on when and what fraction of customers will upgrade. By doing such analysis for several product options under consideration, managers can choose the best feature specification and price path for the upgrade. The proposed approach integrates an individual‐level conjoint utility model with a hazard function specification. The first stage of estimation (i.e., conjoint analysis) measures individual‐level multiattribute utility functions, and the second stage (i.e., duration analysis) calibrates the coefficients of predictor variables of the time to upgrade via maximum likelihood. An illustrative application in the personal digital assistant (PDA) category confirms the predictive validity and potential usefulness of the proposed approach. Among the empirical findings are that higher upgrade costs and expectation of faster product improvement tend to delay buyers' upgrading decisions. The roles of other predictor variables such as product category characteristics, consumer characteristics, and peer pressure were also confirmed.