Reassessing Brand Loyalty, Price Sensitivity, and Merchandising Effects on Consumer Brand Choice

Abstract

This article reports the results of an empirical study of household brand choices over four scanner-panel data sets. The study uses a random-effects, autocorrelated, logistic regression model. The analysis presents evidence that the brand-choice process is not zero-order. In addition, the influence of in-store displays and feature advertisements on switching is shown to be about two to three times more effective than estimates obtained from previous studies. Finally, the analysis indicates systematic differences between frequent and infrequent buyers of products in terms of their sensitivity to price, displays, and feature advertising.