Segmentation Strategies for New National Brands

Author(s): Robert C. Blattberg, Thomas Buesing and Subrata K. Sen

Source: Journal of Marketing, Vol. 44, No. 4 (Autumn, 1980), pp. 59-67
Published by: American Marketing Association
Stable URL: http://www.jstor.org/stable/1251231
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 ROBERT C. BLATTBERG, THOMAS BUESING, & SUBRATA K. SEN

The authors examine the issue of determining the market

segments to which a new national brand should be targeted.
The usual recommendation is that the new brand should be
targeted toward those segments that exhibit considerable
brand switching. However, a new national brand should also
attempt to attract segments that are loyal to existing national
brands as well as segments that primarily purchase private
labels. These implications follow from an explicit considera-
tion of the changes in pricing and distribution patterns which
occur when a new national brand is introduced. The results
are illustrated with a set of diary panel data for facial tissue.

SEGMENTATION STRATEGIES

FOR NEW NATIONAL BRANDS

A N important managerial issue in new product intro-
duction is the determination of the target segments
for the new brand. However, most new product models
(see, for example, Blattberg and Golanty 1978; Eskin
1973; Mahajan and Muller 1979; Parfitt and Collins
1968; Shocker and Srinivasan 1979; Silk and Urban
1978) have concentrated primarily on predicting the
sales of the new product. In fact, other than some work
in conjoint analysis (see Green and Srinivasan 1978),
the only attempt at determining the target segments for
a new brand consists of the Hendry model (Butler 1976)
which predicts that a new brand will obtain most of its
consumers from segments that are not loyal to any
single brand.
Is it indeed true that brand switchers are the only
relevant target segments for a new brand? We address
Robert C. Blattberg is Professor of Marketing and Statis-
tics, Graduate School of Business, University of Chicago,
Thomas Buesing is with Peat, Marwick and Mitchell, and
Subrata K. Sen is Associate Professor of Business Ad-
ministration, Graduate School of Management, Univer-
sity of Rochester. The authors would like to thank Jerry
Wind for his very valuable comments.
this question by providing a detailed analysis of the
sources of a new brand's sales. In particular, we exam-
ine the impact of the introduction of Puffs in the facial
tissue market. The principal managerial implication of
our analysis is the determination of the market segments
to which a new brand should be targeted.
Description of the Segmentation Scheme
We employ a segmentation approach (see Blattberg and
Sen 1974, 1976) that has proved to be useful in other
applications. The approach is limited to inexpensive
frequently purchased products and requires the availa-
bility of consumer panel data. The analysis is done at
the individual household level and each household is
classified (by a Bayesian model discrimination proce-
dure described by Blattberg and Sen 1975) into one of a
set of segments defined a priori. The segment defini-
tions are based on three purchasing dimensions: (1) the
degree of household brand loyalty, (2) the type of brand
'The full details of the Hendry approach have not been published.
Hence, our knowledge of the Hendry model is limited to the information
contained in publications such as Butler's (1976) and Kalwani and
Morrison's (1977).

Journal of Marketing
Vol. 44 (Fall 1980), 59-67. Segmentation Strategies for New National Brands / 59

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 preferred (national or private label), and (3) the house-
hold's price sensitivity (see Blattberg and Sen 1974 for
a justification of this approach). The six most important
segments thus defined are used in the analysis. They are
briefly described below.

* National Brand Loyal. Members of this segment

primarily buy a single national brand at its regular
price.

* National Brand Deal. This segment is similar

to the National Brand Loyal segment except that
most of the purchases are made on deal. To buy the
preferred national brand on deal, the consumer en-
gages in considerable store switching.

Private Label Loyal. Households in this segment

primarily buy the private label offered by the store at
which they usually shop.

Private Label Deal. This segment shops at many

stores and buys the private label of each store,
usually on deal.

* National Brand Switcher. Members of this segment

tend not to buy private labels. Instead, they switch
regularly among the various national brands on the
market.

* Private Label Switcher. This segment is similar to

the Private Label Deal segment except that the mem-
bers are not very deal prone and purchase the private
labels at their regular prices.
profile" (Butler 1976, p. 56). In other words, a new
brand's market share will come primarily from those
Purchase histories of households typical of these consumers who do not have a high probability of buying
segments are given by Blattberg and Sen for aluminum any particular brand, i.e., brand switchers. If brand
foil (1974) and for facial tissue (1976). switchers are the primary source of a new brand's sales,
This segmentation method has been applied to five we can predict the degree to which the new brand will
frequently purchased products: aluminum foil, waxed obtain market share in each of the six segments de-
paper, facial tissue, liquid detergent, and headache rem- scribed in the preceding section.
edies. Comparability of results across products is
discussed by Blattberg, Peacock, and Sen (1976), who Market Share Predictions by Segment
show that consumers frequently use identical or similar
Clearly, the new brand should achieve its largest market
purchasing strategies across product categories.
share in the two segments that consist primarily of
brand switchers: the National Brand Switcher segment
Market Share Predictions and the Private Label Switcher segment. The new brand's
market share should be second largest in the National
for the Hendry Model
Brand Deal segment and the Private Label Deal seg-
ment. Members of these two segments are sensitive to
Description of the Hendry New Product Analysis
deals and, hence, are willing to switch brands if the deal
The Hendry model states that a new brand's market is sufficiently attractive. The new brand should do least
share depends on the "consumer preference profile" of well in the two segments that are loyal to a single
the market (Butler 1976, p. 53). The consumer prefer- brand: the National Brand Loyal segment and the Pri-
ence profile consists of the distribution of consumer vate Label Loyal segment.
"preferences and buying habits" (Butler 1976, p. 53). We now examine the degree to which these predic-
A typical consumer preference profile is reproduced in tions are supported in the case of Puffs, a national brand
Figure 1. Further, a new product will obtain most of its of facial tissue that was introduced in the Chicago
customers from the "middle section of the preference market in August 1961.

60 / Journal of Marketing, Fall 1980

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 TABLE 1
Market Share and Penetration of Puffs in the Six Segments
Number of
Households
Segment Period Market Share Penetration in Segmenta
National Brand 47-56b 17.4% .514 74
Loyal 57-66 12.4 .446 65
National Brand 47-56 15.6 .571 28
Deal 57-66 16.1 .556 27
Private Label 47-56 13.1 .560 50
Loyal 57-66 11.2 .438 48
Private Label 47-56 20.2 .531 64
Deal 57-66 13.8 .377 61
National Brand 47-56 20.1 .681 72
Switcher 57-66 16.6 .531 64
Private Label 47-56 16.6 .673 52
Switcher 57-66 13.8 .500 46

aThe number of households in

the households either drop out of
bPuffs was introduced in period

Description of the Data Results

A set of diary panel data on facial tissue purchases was
Market Share
obtained from the Chicago Tribune's panel of women in
the Greater Chicago area. The data analyzed consist of Puffs' market share figures for the six segments are
purchases for 260 weeks starting in 1958. Of the 16 listed in Table 1. The results are presented separately
brands coded 1 to 16, brands 1 (Kleenex), 2 (Scotties), for two subperiods after the introduction of Puffs: peri-
6 (Puffs), 10 (Vanity Fair), and 13 (Doeskin) are na- ods 47-56 (which can be viewed as an initial period
tional brands and the rest are private labels. The stores and periods 57-66 (a longer run repeat buying period).3
are coded 1 to 10. Stores 1 to 4 are major supermarket The market share of Puffs is larger in the earlier time
chains (Store 1 is A&P, Store 2 is National, Store 3 is period (periods 47-56) than in periods 57-66,4 as
Jewel, Store 4 is Kroger). Stores 5 to 7 are independent expected, for all segments except the National Brand
food chains (e.g., Store 6 is Certified). Store 8 is Deal segment.
Walgreen's, a major drug store chain, Store 9 repre- If the market shares for the latter period are converted
sents other drug stores, and Store 10 represents all otherinto a rank order, the rank ordering is reasonably con-
stores.
sistent with the rank ordering predicted in the preceding
For the first 46 four-week periods of the data, Puffssection. For example, Puffs achieves its largest market
was not available in the market. This section of the data share in the National Brand Switcher segment and its
was used to classify individual households into the six two smallest shares in the National Brand Loyal and
segments.2 The behavior of these segments in relation Private Label Loyal segments.
to Puffs was then analyzed for the remaining 20 four-
week periods (47-66) when Puffs was introduced into
the Greater Chicago market. 3Table 1 also provides penetration figures for the six segments, where
penetration has the usual definition of the proportion of households in the
segment that have tried Puffs at least once.
4It would be desirable to report whether these differences are statisti-
cally significant. However, appropriate statistical tests for diary panel
2The classification was applied to the 474 households that had made at data are very complex. The test must incorporate the fact that the
least 10 purchases of facial tissue prior to the introduction of Puffs. The
observations are correlated between periods (because the data are being
cutoff figure of 10 was chosen because it is very difficult to interpret the
obtained from the same households). It is also necessary to consider other
purchasing patterns of consumers making less than 10 purchases. The 474 factors such as seasonal buying differences and the number of panel
households that qualified for the analysis accounted for 91.8% of the members who drop out of the panel and need to be replaced. The exact
panel's facial tissue purchases. Note, however, that the results reported formula for the variance of the appropriate test statistic is complicated
exclude 17.3% of the 474 households. The omitted households changed and beyond the scope of this article. Hence, the results are presented
their purchasing patterns in the pre-Puffs period. without significance tests.

Segmentation Strategies for New National Brands / 6

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 consumers across the board. This point is highlighted in
Figure 2 which is a plot of Puffs' market share for
periods 57-66 for the six segments. We observe that
Puffs' share in each segment deviates very little from
its average market share of roughly 14%.
We conclude, therefore, that a new national brand
obtains its sales not only from brand switchers but from
all consumers. This finding has important marketing
implications which we explore in the next section. First,
however, we examine the brands from which Puffs
obtained most of its share.

Sources of Puffs' Market Share

Table 2 lists the market shares of eight of the leading

Though there is a reasonable match between the
actual and predicted rank orders, the dominant feature
of Table 1 is that the range of the actual market share
figures in the various segments is very small. The market
shares all are between 11.2% and 16.6% for periods
57-66. This finding indicates that Puffs obtains its sales
not just from the two switching segments but from
brands in the facial tissue market for the two periods
before and after the introduction of Puffs. We can
examine this table to make rough estimates of the brands
from which Puffs has obtained most of its share.
For the National Brand Loyal and National Brand
Deal segments, Puffs' share has come mainly at the
expense of Scotties. For the Private Label Loyal, Pri-
vate Label Deal, and Private Label Switcher segments,
Puffs' share has come mainly from brands 4 and 5
(Angel Soft and Swanee Color Soft, respectively), two
relatively high-priced "limited distribution" private la-
bels. In addition, brand 7 (Walgreen's private label) lost
market share to Puffs in the Private Label Deal seg-
ment, and in the Private Label Switcher segment some
of Puffs' share came from the "other" brands. Finally,
for the National Brand Switcher segment, Puffs' share

TABLE 2
Market Shares of Leading Brands in the Six Segments
Limited
National Brands Distribution Brands Private Labels
1 2 6 4 5 3a 7b 8a
Angel Swanee
Segment Period Kleenex Scotties Puffs Soft Color Soft Jewel Walgreen Jewel Others
National Brand 1-46 .466 .427 .000 .007 .015 .017 .004 .004 .033
Loyal 47-66 .414 .321 .150 .003 .014 .032 .000 .000 .045
National Brand 1-46 .640 .189 .000 .018 .013 .019 .022 .005 .053
Deal 47-66 .580 .124 .159 .013 .006 .052 .016 .000 .032
Private Label 1-46 .053 .020 .000 .319 .154 .278 .014 .080 .031
Loyal 47-66 .089 .057 .122 .239 .093 .279 .008 .025 .051
Private Label 1-46 .181 .040 .000 .212 .069 .097 .196 .031 .121
Deal 47-66 .172 .091 .174 .079 .031 .158 .124 .006 .081
National Brand 1-46 .262 .178 .000 .059 .103 .108 .014 .023 .126
Switcher 47-66 .257 .193 .184 .020 .052 .140 .015 .006 .081
Private Label 1-46 .069 .028 .000 .206 .200 .204 .039 .055 .092
Switcher 47-66 .102 .096 .154 .088 .161 .262 .028 .008 .064
aBrands 3 and 8 are both private labels of the Jewel food chain.
bBrand 7 is the private label of the Walgreen's drug chain.

62 / Journal of Marketing, Fall 1980

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 TABLE 3
Segment Membership
Before and After Introduction of Puffs
Segments After Introduction
of Puffs

Segments Before National National Private Private National Private

Introduction Brand Brand Label Label Brand Label Row
of Puffs Loyal Deal Loyal Deal Switcher Switcher Totals
National Brand 64.1%a 15.4 2.6 0.0 17.9 0.0 39
Loyal

National Brand 11.8 70.6 0.0 0.0 17.6 0.0 17

Deal

Private Label 5.7 8.6 40.0 20.0 17.1 8.6 35

Loyal

Private Label 0.0 8.0 0.0 68.0 12.0 12.0 25

Deal

National Brand 13.5 24.3 5.4 10.8 37.8 8.1 37

Switcher

Private Label 0.0 13.3 3.3 43.3 13.3 26.7 30

Switcher

Column Totals 34 36 18 41 37 17 183

aThe entry in cell (i,j) represents the percentag

appears to have been achieved mainly at the expense of the degree to which households continued to use the
Swanee Color Soft and the "other" brands. purchasing strategy they had used prior to the availabil-
ity of Puffs.6
Table 3 indicates that members of two of the three
Marketing Implications national brand segments (National Brand Loyal and
National Brand Deal) tend to follow the same purchas-
Strategies Followed After the
Introduction of Puffs
ing strategy before and after the introduction of Puffs
(see the relatively large diagonal entries for these two
Before discussing specific marketing implications, wesegments). When a national brand segment's purchasing
examine whether households continued to use the same strategy does change after Puffs' introduction (see the
purchasing strategy after the introduction of Puffs. For relatively low 37.8% diagonal entry for the National
example, did Private Label Loyal households continueBrand Switcher segment), it changes to a relatively
the strategy of buying private labels or did they start tosimilar strategy. For example, most of the National
buy Puffs or some other national brand? Also, didBrand Switchers who change strategies change to simi-
members of the National Brand Loyal segment continue lar strategies such as those followed by members of the
to purchase the national brand they had purchased beforeNational Brand Deal and National Brand Loyal seg-
the introduction of Puffs or did a significant number of ments. Specifically, Table 3 indicates that 24.3% of
them switch their loyalty to Puffs? The purchasing National Brand Switchers change to a National Brand
strategy changes discussed below have a bearing on Deal strategy and 13.5% switch to a National Brand
certain marketing implications discussed later in this
Loyal strategy. In contrast, members of the three pri-
section.
vate label segments tend to switch strategies after the
Table 3 is a cross-tabulation of the purchasing
strategies used by families before and after the introduc-
6To better evaluate the figures in Table 3, it would be desirable to use
tion of Puffs.5 The diagonal entries of the table indicate as a benchmark the degree to which households switch purchasing strate-
gies in the absence of the introduction of a new brand such as Puffs.
Though the figure is not exactly analogous to the data in Table 3, note
5Table 3 is based on the 183 households that had made at least 10
that 17.3% of the households switched purchasing strategies in the pre-
purchases in both pre-Puffs and post-Puffs periods and which did not Puffs period. This level is considerably lower than the switching indi-
change their purchasing patterns in either of the two periods. cated in Table 3.

Segmentation Strategies for New National Brands / 63

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 introduction of Puffs (see, in particular, the relatively loyalty to Puffs. Convincing them to switch might be
low diagonal entries for the Private Label Loyal and difficult, but if one succeeds the household becomes
Private Label Switcher segments). Further, relatively a steady buyer of Puffs and hence a very profitable
large proportions of the switchers become members of customer.

the national brand segments, particularly the National It is also clear from Table 3 (and household 29
Brand Switcher and National Brand Deal segments. that a National Brand Loyal household can be chan
To illustrate the impact of Puffs on purchasing strat- to a National Brand Switcher household that will
egies at the individual household level, consider the chase Puffs along with other national brands. This gr
purchasing histories of three different households. House- would be another important source of sales for a
hold 952 made 49 purchases prior to the introduction of national brand such as Puffs. The fairly large size of
Puffs. Kleenex accounted for 84% of these 49 pur- National Brand Loyal segment (Table 1) further h
chases. After the introduction of Puffs, this household lights the advantages of attempting to persuade
made 21 additional purchases. Puffs was purchased on households to switch to Puffs either completely or p
every one of these 21 purchase occasions. Thus, house- tially.
hold 952 illustrates a household that continued to use a Thus, an important implication of our analysis is
National Brand Loyal purchasing strategy after the in- that a new national brand should target its appeals to the
troduction of Puffs. However, the household's loyalty National Brand Loyal segment. 7 This implication is not
switched dramatically from Kleenex to Puffs. obtained from a more aggregate analysis of panel data
Household 297 purchased Kleenex in 98% of the 98 for new product introductions, e.g., the Parfitt and
purchases it made before the introduction of Puffs. Collins (1968) and Eskin (1973) brand share prediction
However, after Puffs was introduced, this household models. Nor is this implication suggested by models
switched among several national brands, including Puffs. such as the Hendry model (Butler 1976) which implicitly
For example, Puffs accounted for 33% of the 46 pur- recommends that brand switchers are the only appropri-
chases made by the household after it was introduced ate target segment for a new national brand.
and Kleenex's share dropped from the 98% pre-Puffs
figure to 48%. Thus, household 297 represents a house- Targeting to Private Label Segments
hold that switched its purchasing strategy from National The Effects of Price Changes. Table 1 indicates that
Brand Loyal to National Brand Switcher. Puffs' market share was very high in two of the private
Finally, household 1210 made 10 purchases before label segments, Private Label Switcher and Private Label
the introduction of Puffs. Brand 8 (one of Jewel's pri- Deal. This finding may be somewhat surprising for a
vate labels) was bought on all 10 purchase occasions. national brand such as Puffs. The explanation lies in
After the introduction of Puffs, this household made 15 certain price and distribution changes.
additional purchases. Puffs was bought on every one of Because of Puffs' introduction, the price differential
these 15 purchase occasions. Thus, household 1210 between national brands and private labels became
represents a household that switched from a Private narrower in general, as indicated in Table 4 which lists
Label Loyal strategy (loyal to brand 8) to a National average prices for the eight leading brands before and
Brand Loyal strategy (loyal to Puffs). after the introduction of Puffs. The prices of the two
Targeting to the National Brand national brands, Kleenex and Scotties, drop by a cent or
Loyal Segment two after the advent of Puffs whereas the prices of the
"limited distribution" brands and the private labels
The analysis reported in Table 3 indicates that house-
either remain unchanged or increase slightly. Brand 3
holds purchasing national brands tend to use the same
(one of Jewel's two private labels) is the only non-
or similar buying strategies even after a major perturba-
national brand that decreases in price.8
tion of the market as caused by the introduction of a
Because the price difference between national brands
successful new national brand such as Puffs. Let us
and private labels narrowed after the introduction of
concentrate in particular on the National Brand Loyal
Puffs, many purchasers of private labels (particularly
segment. Table 3 indicates that most households in this
the relatively more expensive "limited distribution"
segment continue to follow the strategy of buying a
private labels such as Angel Soft and Swanee Color
single national brand. Some of these households con-
Soft) switched to national brands (including Puffs). Thus,
tinue to purchase the brand they had purchased before
the introduction of Puffs (e.g., Kleenex). However,
other households (e.g., household 952 described earlier)
switch to Puffs and continue to buy Puffs almost exclu- 70f course, to implement this strategy effectively, one must reach
this segment through the appropriate media.
sively. Clearly, it would be extremely profitable to per-
8Note, however, that none of these price changes is very significant in
suade National Brand Loyal households to switch theira statistical sense (see the standard deviations reported in Table 4).

64 / Journal of Marketing, Fall 1980

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 TABLE 4
Prices of Leading Brands Before and After Introduction of Puffs
Period'

Brand 1-46 47-66

National Brands
1 Kleenex 26.40 (1.28)b 25.42 (1.80)
2 Scotties 26.85 (1.18) 25.02 (1.44)
6 Puffs 25.27(1.11)
Limited Distribution
Brands
4 Angel Soft 20.01 (1.64) 20.16 (1.04)
5 Swanee Color Soft 20.02 (0.87) 20.09 (1.50)
Private Labels
3 Jewelc 18.88 (0.72) 17.72 (1.59)
7 Walgreensd 16.51 (1.78) 17.74 (2.31)
8 Jewelc 19.99 (1.50) 20.38 (2_06)
"Puffs was introduced in period 47.
bThe prices are average prices (in cents) for
deviations of the prices.
CBrands 3 and 8 are both private labels of t
dBrand 7 is the private label of the Walgreen

the market shares of all three national brands (Kleenex, National brands also gained share at the expense of
Scotties, and Puffs) increased for the three private label many of the smaller brands in the "other" category that
segments (see Table 2). The lone exception is Kleenex were dropped by retailers. Finally, the "limited distri-
whose market share decreased slightly in the Private bution" brands such as Angel Soft and Swanee Color
Label Deal segment. Soft also declined in share because of more limited
shelf space (and relatively higher prices). Table 5 indi-
Targeting to Private Label Segments
cates that Angel Soft lost share in all six segments in
The Effects of Distribution Changes. We also examined A&P whereas its share in Independent Food Stores
the impact of Puffs' introduction on the distribution decreased in two of the segments and increased margin-
patterns of existing brands. For instance, Store 3 (Jewel) ally in two others. The other major "limited distribution
had two private labels, brands 3 and 8. Brand 8 was brand," Swanee Color Soft, lost market share in all six
relatively more expensive (see Table 4) and was dropped segments in both the National and Certified chains (see
by Jewel some time after the introduction of Puffs. Table 5). These share losses for Angel Soft and Swanee
Many of the smaller brands in the "other" category Color Soft were picked up by the national brands.
were dropped by retailers and the "limited distribution" The implication of the preceding analyses is that
brands were given less shelf space.9 private label buyers are also good prospects for a new
The result of Jewel dropping brand 8, its relatively national brand, particularly buyers of the relatively ex-
expensive private label, was that some of the customers pensive private labels. Again, this is an implication that
of brand 8 shifted to Jewel's other private label (brand is not obtained from the more aggregate analyses of new
3). This shift is indicated in the first two columns of product introductions such as the Parfitt and Collins
Table 5 which show that brand 3's market share in (1968) and Hendry models (Butler 1976). Our more
Jewel increased in each of the segments whereas brand
disaggregate analysis of panel data shows that such data
8's share in Jewel decreased in each segment. Other are a rich source of information that can provide impor-
customers of brand 8 undoubtedly shifted to the nowtant insights if properly analyzed.'0
relatively cheaper national brands.

9The scenario described in terms of changes in distribution and price 'ONote that other disaggregate methods of analysis, e.g., multiattribute
spreads between national and private label brands is a fairly accuratemodels at the individual consumer level (see Johnson 1974, for example),
description of what happens to the market when a new national brand isdo not provide these insights either. Such methods are based mainly on
introduced. More recently, the scenario was repeated in an almost identi-survey data on perceptions and preferences and do not typically consider
cal manner in the coffee market in Pittsburgh when Procter and Gamblethe impact of price changes and distribution changes in analyzing the
decided to introduce Folgers into that market (Hendrickson 1977). effect of introducing a new brand.

Segmentation Strategies for New National Brands / 65

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 TABLE 5
Brand/Store Market Shares in the Six Segments
Brand/Store

4/5
3/3 8/3 4/1 Angel Soft/ 5/2 5/6
Brand 3/ Brand 8/ Angel Soft/ Independent Swanee Color Swanee Color
Segment Period Jewel Jewel A&P Food Stores Soft/National Soft/Certified
National Brand 1-46 .086a .022 .149 .000 .064 .023
Loyal 47-66 .144 .000 .055 .000 .055 .008
National Brand 1-46 .204 .053 .420 .021 .032 .044
Deal 47-66 .394 .000 .190 .039 .021 .000
Private Label 1-46 .743 .213 .974 .090 .846 .557
Loyal 47-66 .761 .068 .842 .036 .421 .390
Private Label 1-46 .648 .206 .931 .037 .358 .520
Deal 47-66 .816 .033 .718 .000 .268 .110
National Brand 1-46 .587 .124 .726 .000 .305 .125
Switcher 47-66 .657 .029 .350 .000 .115 .080
Private Label 1-46 .753 .202 .973 .015 .820 .407
Switcher 47-66 .833 .026 .690 .024 .492 .340
aThe figure 0.086 is interpreted as: the average mar
of the National Brand Loyal Segment.

Limitations brands and toward purchasers of private label brands.

The value of the analysis we describe would be en- implication is somewhat unexpected because the
This
hanced if data on perceptions and preferences were alsousual recommendation (by the Hendry model, for ex-
available. For example, the analysis of the sources of ample) is that a new brand should be targeted only
Puffs' market share (see the discussion related to Table toward brand-switching households. However, we point
2) would be even more revealing if, in addition to the out that models such as the Hendry model and the
panel data, data had been available on the perceptions multiattribute model focus mainly on consumer brand
and preferences of the households in the panel. In thatpreferences and tend to de-emphasize the effect of other
case, we could have constructed joint-space maps (see factors such as changing prices and distribution patterns
which
Carroll 1972, for example) for each segment and predicted are very common when new brands are intro-
which brands were likely to be most vulnerable to Puffsduced. The method of analysis we describe takes such
in each segment. factors into account (along with brand preference) and
Finally, we emphasize that our results are extremelysuggests that we should re-examine the commonly ac-
tentative because we have analyzed only one brandcepted
in recommendations about strategies for new prod-
uct introduction.
only one product category. Before our results can be
generalized, similar analyses must be performed for other
brands in other product categories.

Summary
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Early Test-Market Forecasting and Diagnostic Model fo
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I
No
U

Proceed To Be Informed With...

MARKETING STRATEGIES FOR A TOUGH READINGS IN MANAGING THE
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Peter J. LaPlaca and Newton Frank, eds.,
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