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Kaswengi, Fall - 2015 - Consumer Choice of Store Brands Across Store Formats A Panel Data Analysis Under Crisis Periods
Kaswengi, Fall - 2015 - Consumer Choice of Store Brands Across Store Formats A Panel Data Analysis Under Crisis Periods
Kaswengi, Fall - 2015 - Consumer Choice of Store Brands Across Store Formats A Panel Data Analysis Under Crisis Periods
art ic l e i nf o
a b s t r a c t
Purpose: This paper investigates the effect of marketing variables and consumer personal characteristics
on store brand choice over national brands in times of crisis in France. It also seeks to clarify how store
formats affect consumption strategies towards brands in turbulent times. Based on a large sample (panel
of 4500 households, N 79,789), we used a binary logit model to assess consumer choice of store brands
over national brands across two different store formats (hypermarket and supermarket). Results show
that, overall, marketing variables and consumer characteristics affect signicantly store brand choice
over national brands. However, while crisis intensity clearly moderates the relationships between
marketing policy variables and store brand choice, it does not affect so extensively the relationships
between consumer characteristics and store brand choice over national brands. Furthermore, hypermarket and supermarket formats are not affected similarly by crisis. This research highlights the diversity of
consumer strategies developed to cope with economic crises. Theoretical and managerial implications of
these ndings are discussed.
& 2014 Elsevier Ltd. All rights reserved.
Keywords:
Store brand
National brand
Marketing mix
Socio-demographics
Crisis
Store format
1. Introduction
The strategic role of store brands (SBs) has been emphasised in
prior European studies (Lamey et al., 2007; Martos-Partal and
Gonzlez-Benito, 2011) and especially in France (Ataman et al.,
2007; Diallo et al., 2013). According to Nielsen Scan Track, store
brand market shares increased in value from 22% in 2002 to 30% in
2012 in France. Some researchers attribute this growth to the
economic crisis in the European context (Lamey et al., 2007). Other
researchers showed that during this economic shock, consumers
switched to store brands and decreased their consumption expenditures (Kaytaz and Gul, 2014). However, although prior studies
emphasized the importance of store formats for consumers in
different contexts (Martnez-Ruiz et al., 2010; Seock, 2009; Tripathi
and Dave, 2013; Zielke, 2010), it is not clear how consumers make
their choice of brands in different store formats during crisis periods.
We use the term format to distinguish between supermarket and
hypermarket retailers. Nevertheless, tough previous studies gave no
indication about brand choice in different store formats in crisis, we
can assume a migration phenomenon between formats to cope with
the economic situation. Over the past years, smaller formats such as
Corresponding author.
E-mail addresses: joseph.kaswengi@univ-orleans.fr (J. Kaswengi),
mbayefall.diallo@univ-lille2.fr (M.F. Diallo).
1
Address: IMMD, 6 rue de lhtel de ville, 59050 Roubaix, France.
http://dx.doi.org/10.1016/j.jretconser.2014.12.003
0969-6989/& 2014 Elsevier Ltd. All rights reserved.
J. Kaswengi, M.F. Diallo / Journal of Retailing and Consumer Services 23 (2015) 7076
brand choice over national brands in times of crisis while taking into
account different store formats. Thus, our research intends to understand consumer and retailer adjustments in times of crisis. By doing
so, we complement previous studies on the relationship between
business cycle and store brand purchase (Hoch and Banerji, 1993;
Lamey et al., 2012).
This paper adds to the existing literature in the following ways.
First, whereas prior research yielded important insights about store
performance, to the best to our knowledge, the effects of the
economic crisis on the relationships between marketing variables,
consumer personal factors and store brand choice relative to
national brands have not yet been examined. Our research contributes to understand how retailers should adapt specic marketing
mix variables and how they should manage changes in sociodemographic variables when crisis hits. In this respect, it intends
to complete more general recent studies analysing how marketing
variables affect retail strategies in times of crisis (Hampson and
McGoldrick, 2013; Kaytaz and Gul, 2014; Ferguson, 2014). Second,
although prior research addressed the issue of store format in
relation to consumer behaviour (e.g., Kumar and Karande, 2000;
Zielke, 2010), it did not investigate store format adjustments in
times of crisis. However, retailers need to understand quickly how to
adapt their store format management strategies when economic
crisis leads consumers to make changes in store frequentation.
Therefore, we intend to clarify the role of store format in times of
crisis by analysing two retail formats, in an attempt to extend and
bolster recent previous studies on the subject (e.g., Kaswengi, 2013;
Kumar and Roy, 2013).
The rest of the paper is structured as follows: rst, we examine
previous studies on store brands and present our research hypotheses. Second, we present the research methodology. Third, the
results are analysed. Finally, the paper concludes with a discussion
of the implications of the ndings and suggests avenues for further
research.
2. Theoretical framework
2.1. Research background
The central tenet of this research is that marketing elements,
socio-demographics and times of crisis play a role in store brand
choice over national brands. There are numerous studies that model
the utility function of the consumer as a function of marketing
variables (e.g. feature, display, ) and nd that these actions affect
utility and thus, brand choice (Balachander and Ghose, 2003). An
example is Erdem et al. (2004) who examined consumer choice
behaviour with regard to store brands in the United States, the United
Kingdom, and Spain. They found that consumer preferences for
quality and price explain consumers store brand choices. Previous
research also suggested that store brand choice can be linked to
demographic proles (Dhar and Hoch, 1997). For example, Ngobo
(2011b) showed that the rate of organic store brands increases
according to the presence of a working female. However, these
studies do not consider some key aspects of store brand consumption
such as the business cycle, which affects consumer purchasing power.
Therefore, by considering the variable crisis times, it is possible to
further understand relevant marketing actions that inuence customer behaviour. Hampson and McGoldrick (2013) review many
studies showing that consumers shopping attitudes and behaviours
are sensitive to recession. The behaviours may reect consumer
consciousness, especially in terms of price (Lichtenstein et al., 1993).
Sinha and Batra (1999) showed that store brands are an excellent
alternative for price conscious consumers. In line with Kaytaz and
Gul (2014), the economic crisis is summed up to play a role in the
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J. Kaswengi, M.F. Diallo / Journal of Retailing and Consumer Services 23 (2015) 7076
3. Research methodology
3.1. Model specication
The deterministic component of latent utility of household h
for format f on trip t is given by:
U t h f h; f X t h; f h t h; f ;
J. Kaswengi, M.F. Diallo / Journal of Retailing and Consumer Services 23 (2015) 7076
Table 1
Socio-demographic description of the panel.
Freq. (%)
Gender
Men active
Women active
Women inactive
Men inactive
Total
Age of the family head
1829
3039
4049
5059
More than 59 years
Total
Profession
Categories ( )
Categories ( )
Total
Family size
1 Person
2 Persons
3 Persons
4 Persons
5 Persons
67 Persons
Total
Low crisis
High crisis
3,772
28,669
9,368
1,094
42,903
(8.8)
(66.8)
(21.8)
(2.5)
(100.0)
3,322
24,221
8,384
959
36,886
(9.0)
(65.7)
(22.7)
(2.6)
(100.0)
1,536
7,456
14,273
11,002
8,636
42,903
(3.6)
(17.4)
(33.3)
(25.6)
(20.1)
(100.0)
1,227
6,411
12,401
9,179
7,668
36,886
(3.3)
(17.4)
(33.6)
(24.9)
(20.8)
(100.0)
24,044 (56.0)
18,859 (44.0)
42,903 (100.0)
20,680 (56.1)
16,206 (43.9)
36,886 (100.0)
5,464
12,048
8,083
10,107
6,045
1,158
42,903
4,869
10,192
6,806
8,922
4,991
1,106
36,886
(12.8)
(28.1)
(18.8)
(23.6)
(14.1)
(2.7)
(100.0)
(13.2)
(27.6)
(18.5)
(24.2)
(13.5)
(3.0)
(100.0)
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J. Kaswengi, M.F. Diallo / Journal of Retailing and Consumer Services 23 (2015) 7076
Table 2
Descriptive statistics across product categories investigated.
Low crisis (2008) N 42,903
P1
P2
P3
P4
P1
P2
P3
P4
Number of brand
purchases
NB: N 7170
SB: N 1399
NB: N 5991
SB: N 2443
NB: N 10,427
SB: N 8,148
NB: N 6162
SB: N 1163
NB: N 6154
SB: N 1077
NB: N 4691
SB: N 2025
NB: N 9,089
SB: N 8,143
NB: N 4747
SB: N 960
Price product
Brand display
No: N 8219
Yes: N 350
No: N 7287
Yes: N 1147
No: N 17,628
Yes: N 947
No: N 6570
Yes: N 755
No: N 6920
Yes: N 311
No: N 5756
Yes: N 960
No: N 15,968
Yes: N 1,264
No: N 5193
Yes: N 514
Brand feature
No: N 8534
Yes: N 53
No: N 8386
Yes: N 48
No: N 17,673
Yes: N 48
No: N 6605
Yes: N 720
No: N 7092
Yes: N 139
No: N 6295
Yes: N 421
No: N 16,123
Yes: N 1,109
No: N 5404
Yes: N 303
Note: P1 toothpaste; P2 shower gel; P3 pasta; P4 shampoo; NB national brand; SB store brand: M(sd) means (average price).
Table 3
Effects of marketing variables and socio-demographic factors, (N 79,789 with NCrisis
low 42,903
and NCrisis
high 36,886).
Independent variables
Marketing variables
SE
Wald
Sig.
SE
Wald
Sig.
Intercept
Product price
Quantity of products purchased
Brand display
Brand feature
Crisis Product price
Crisis Quantity of products
Crisis Brand display
Crisis Brand feature
3.50
2.124
1.662
1.322
1.122
.089
.019
.030
.041
.051
1,547.453
13,145.885
2,991.636
1,053.372
484.672
.000
.000
.000
.000
.000
3.451
2.058
1.447
1.230
.988
.150
.468
.138
.217
.090
.024
.040
.055
.068
.035
.060
.070
.080
1480.460
7323.010
1300.346
501.824
213.516
18.074
61.691
3.941
7.432
.000
.000
.000
.000
.000
.000
.000
.047
.006
Socio-demographics variables
Age
Profession
Income
Family size
Crisis Age
Crisis Profession
Crisis Income
Crisis Family size
.063
.096
.024
.024
SE
.004
.022
.005
.005
Wald
283.610
18.617
19.523
19.511
Sig.
.000
.000
.000
.000
.065
.127
.025
.018
.003
.067
.001
.014
SE
.005
.030
.007
.007
.007
.044
.010
.011
Wald
167.071
17.707
11.471
5.592
.179
2.360
.019
1.805
Sig.
.000
.000
.001
.018
.673
.124
.891
.179
Table 4
Similarities and differences across store formats.
Independent variables
Intercept
Product price
Quantity of products purchased
Brand display
Brand feature
Age
Profession
Income
Family size
Crisis low
Crisis high
Hyper
(N 25,876)
Sig.
Super
(N 17,027)
Sig.
Hyper
(N 22,035)
Sig.
Super
(N 14,851)
Sig.
3.084
2.155
1.716
1.059
.810
.066
.122
.035
.034
.000
.000
.000
.000
.000
.000
.002
.000
.000
4.033
1.943
.962
1.454
1.152
.065
.119
.011
.008
.000
.000
.000
.000
.000
.000
.015
.371
.515
3.404
2.239
2.054
1.422
1.131
.053
.097
.028
.041
.000
.000
.000
.000
.000
.000
.024
.006
.000
3.391
2.186
1.522
-.938
1.257
.077
.025
.021
.015
.000
.000
.000
.000
.000
.000
.628
.096
.245
J. Kaswengi, M.F. Diallo / Journal of Retailing and Consumer Services 23 (2015) 7076
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J. Kaswengi, M.F. Diallo / Journal of Retailing and Consumer Services 23 (2015) 7076
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