Author:
Dawes John G.,Graham Charles,Trinh Giang
Abstract
Purpose
The study investigates 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. We identify brand buyers in a base year, then calculate the proportion that fail to buy the brand in later years. We analyse the top 20 brands in 10 consumer goods categories.
Findings
We find pronounced erosion in repeat-buying over the long-term. The proportion of buyers from a base year that fail to buy in a later year increases steadily over time, from 57% in year 2 to 71.5% by year 5. Moreover, we identify 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.
Reference107 articles.
1. The effects of discount level, price consciousness and sale proneness on consumers' price perception and behavioral intention;Journal of Business Research,2002
2. Reassessing Brand loyalty, price sensitivity, and merchandising effects on consumer Brand choice;Journal of Business and Economic Statistics,1995
3. Salience and choice: neural correlates of shopping decisions;Psychology and Marketing,2004
4. Building brands;Marketing Science,2008
5. The long-term effect of marketing strategy on Brand sales;Journal of Marketing Research,2010
Cited by
14 articles.
订阅此论文施引文献
订阅此论文施引文献,注册后可以免费订阅5篇论文的施引文献,订阅后可以查看论文全部施引文献