Summary Of An Academic Article In Marketing

Essay by PaperNerd ContributorUniversity, Master's November 2001

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Pursuing the value-conscious consumer: Store brands versus national brand promotions Journal of Marketing; New York; Jan 2001 Kusum L Ailawadi; Scott A Neslin; Karen Gedenk The study presented in the article tries to determine if national brand promotion is in direct competition against store brands because both share the same distribution channel. Thus, the main question is: are manufacturers and retailers rather competitors or partners? The national brands usually sell for around 30 % more than store brands, but this pre-mium often is offset by national promotions that offer discounts from 20 to 30 %. If national brand promotions and store brands attract the same value-conscious consumers then manufac-turers and retailers compete for the same market segment. On the other hand it is also possible, that national brand promotions and store brands may satisfy different consumer needs, al-though the price of both may be similar.

The article divides national brand promotions (= deal usage) into in-store-promotions and out-of-store-promotions.

In store promotions are used opportunistically and passively, and includes displays or in-store specials. Out of store promotions include coupons, in-store flyers and are actively considered before the consumer goes shopping. Thus the three behaviours of interest are store brand use, in-store national brand promotion use, and out-of-store national brand promotion use.

The study is based on a survey that consists of interviews of 319 adults and focuses on national brand promotions and store brands at the same time which has rarely done before. It first develops a structural model in order to examine the relationship of demographics and psychographics with deal- and store brand usage. Therefore 15 psychographic variables are identified and their hypothetical influence on store brands, in-store- and out-of-store-promotion are anticipated. Afterwards the links between psychographics and the corresponding demo-graphics are taken under closer consideration. Therefore seven...