Does Double Jeopardy Apply Using Average Spend per Buyer as the Loyalty Metric?

Dawes, John; Bond, Allison; Hartnett, Nicole; Sharp, Byron

doi:10.1016/j.ausmj.2017.10.008

Cited by 11 publications

(7 citation statements)

References 36 publications

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“…3.8 Brand size (penetration), category purchase rate and category penetration Larger brands, that is, brands with higher market share and penetration, are known to have higher loyalty (Ehrenberg et al, 1990;Dawes et al, 2017). East and Hammond (1996) also found they had lower erosion rates.…”

Section: Large Rangementioning

confidence: 99%

The long-term erosion of repeat-purchase loyalty

Dawes

Graham

Trinh

2020

EJM

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Purpose This study aims to investigate the long-term erosion of repeat-purchase loyalty among consumers who purchase brands in a one-year base period. Design/methodology/approach The study uses a five-year consumer panel of continuous reporters. This paper identifies brand buyers in a base year, then calculates the proportion that fails to buy the brand in later years. This paper analyses the top 20 brands in 10 consumer goods categories. Findings This paper finds pronounced erosion in repeat-buying over the long-term. The proportion of buyers from a base year that fails to buy the brand in a later year increases steadily over time, from 57% in year 2 to 71.5% by year 5. Moreover, this paper identifies brand and marketing mix factors linked to this over-time customer loss or erosion. Research limitations/implications The study provides evidence that consumers’ propensity to buy particular brands changes over a period of years, even though those brands continue to exhibit a stable market share. This evidence provides a different interpretation than the literature to date, which has viewed purchase propensities as fixed. Practical implications The study finds that store brands and niche brands exhibit lower levels of erosion in their buyer base that a broad range is associated with lower erosion and that high price promotion incidence is associated with lower erosion for manufacturer brands. Originality/value Loyalty erosion has been reported before (Ehrenberg, 1988; East and Hammond, 1996) but only over short periods. This study examines the phenomenon over five years, confirms that the rate of erosion does diminish over time and that it is related to category and brand characteristics, as well as marketing mix decisions.

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Section: Large Rangementioning

confidence: 99%

The long-term erosion of repeat-purchase loyalty

Dawes

Graham

Trinh

2020

EJM

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“…When outlining brands sharing customers, use duplication of purchase (DoP) (Goodhardt, 1966). These useful patterns measure loyalty toward, and competition between FMCG brands, product variants (Singh et al, 2008), and prices (Dawes et al, 2017). The recent expansion of these analytical tools includes the context of private label brands (Dawes & Nenycz-Thiel, 2013), an unusual condition given the lower branding investments.…”

Section: Introductionmentioning

confidence: 99%

Analyzing proprietary, private label, and non-brands in fresh produce purchases

Anesbury

Jürkenbeck

Bogomolov

et al. 2020

International Journal of Market Research

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When purchasing packaged products within a supermarket, consumers choose between proprietary or private label brands. However, when purchasing fresh fruits and vegetables, non-branded produce is the dominant option—with proprietary and private label brands only recently becoming available. Previous fast-moving consumer goods (FMCG) research finds that proprietary and private label brands affect consumer loyalty—however, no research exists for fresh categories. This research is the first to determine the effect of emerging brands in fresh categories on consumer buying behavior. Our research examines consumers’ loyalty toward proprietary, private label, or non-branded fresh fruits and vegetables and the level of customer sharing between these options, using analytical approaches applicable to FMCG categories. The panel data contains nearly 46,000 households making over 8 million purchases in the United States during 2015. Results show that proprietary, private label, and now non-branded fresh produce have expected loyalty levels, for their size, and consumers share their purchases across the three options (i.e., consumers are not loyal to just one option). The study analyzes and interprets purchase data in fresh categories offering marketing academics and practitioners actionable advice for working with fresh produce purchase data.

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“…While niching, partitioning and change of pace are behaviors analogous to segmentation they are discussed in terms of the Dirichlet. Dawes et al (2017) found that the Dirichlet also holds when applied to average spend per brand. Scriven et al (2017b) precisely calibrated the cost of promotion versus loyalty to a brand.…”

Section: Lowe's Paradigm Mapping Categories As Descriptorsmentioning

confidence: 99%

Incommensurability and Paradigm Crossing: Folding the EGs Back into the Omelet or Blood in the Water?

Shaw

Nowicki²

2018

Australasian Marketing Journal

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The Empirical Generalists (EGs) suggest that the accepted focus on segmentation and loyalty in Marketing Management is irrelevant and that the Dirichlet equation and Double Jeopardy provide the only useful theory of consumer behavior. Meanwhile the Segmentationalists adhere to a Marketing Management model and blithely ignore their claims. This discussion examines the extremes of a continuum which extends from the breadth of Kotler (1967) to the reductive analysis of Sharp (2010) . Lowe et al., (2004) have provided an easily understood set of categories that describes these paradigmatic differences. This is applied along with an integrative framework adapted from Rossiter, (2012) which suggests remedial linkages. However recent work by the Empirical Generalists suggests that this is flogging a dead horse. The response from Marketing Management adherents has been a refusal to engage and a denial of oxygen to the debate. The implications for marketing strategy are considerable since the continued utility of the key technique of segmentation is under challenge. Will it survive as a valid technique for addressing the market or will it be reduced to a mere description of customer type? Is it a harmless symbolic activity or an organizational hallucination that blocks progress?

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Does Double Jeopardy Apply Using Average Spend per Buyer as the Loyalty Metric?

Cited by 11 publications

References 36 publications

The long-term erosion of repeat-purchase loyalty

The long-term erosion of repeat-purchase loyalty

Analyzing proprietary, private label, and non-brands in fresh produce purchases

Incommensurability and Paradigm Crossing: Folding the EGs Back into the Omelet or Blood in the Water?

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