Statistical Inference Using Stochastic Switching Models for the Discrimination of Unobserved Display Promotion from POS Data

The execution of price and/or display promotion has a significant effect on the sales of a brand sold in a supermarket. Information on price and/or sales is available from POS data. However, unless an investigator collects information on the execution of display promotions from every retail store, such information is unavailable. This paper presents a method of identifying whether display promotion has been executed without having to visit individual stores. We treat the execution/non-execution of a display promotion as a state variable. An unknown stationary probability matrix is assumed to describe the probability of a transition between states. Each state is characterized by a different stationary time series model with unknown parameters. The objective of the analysis is to identify the model and to assign a probability model for each state at each time instant. Finally, we provide a high precision estimator of a past execution/non-execution of a display promotion based on the proposed model.     

Impact of sales Promotion's benefits on perceived value: Does product category moderate the results?

The purpose behind the development of this research article is to assess the impact of sales promotions benefits on consumer perceived value and examine the moderating effect of product categories on the relation between sales promotions, their benefits, and consumer perceived value. The study used a sample of 400 consumers from India and ‘Structure Equation Modelling’ technique is applied to evaluate the research assumption. Finally, the moderating effect of the product category is evaluated by utilizing ‘Multi-Group Analysis' technique. Research findings reveal that the product category moderates the consumer's perceived value for hedonic and utilitarian benefits of sales promotion tools. It is found that utilitarian benefits of sales promotion have more impact on consumer perceived value in the context of personal care product while hedonic benefits are having more impact on consumer perceived value in the context of food products. A sales promotion plan can be made more effective when it is hedonic benefit oriented in the case of food products and utilitarian benefit oriented in the case of personal care products. The findings of this research can be useful for marketers to develop an effective sales promotion strategy considering the category wise differential impact of sales promotions benefits.     

Brand-Pack Size Cannibalization Arising from Temporary Price Promotions

This study investigates how price promotions for one pack-size of a brand steal sales from the other pack-sizes of the same brand. To do so, the study examines twelve grocery product categories (seven US, three UK, two Australian). The analysis finds heavy cross-pack cannibalization. On average, 22 percent of the sales uplift for a promoted brand-pack size comes from other pack sizes of the same brand. Cross-pack cannibalization most typically occurs in the week of the promotion, but also transfers future week's sales away from the non-promoted pack size in 31 percent of cases. The study finds higher cannibalization is associated with packs that sell for a higher dollar value than others sold under the same brand; whereas higher price-per-weight, a packaging difference, and the item having a larger relative share of sales in the brand portfolio, are linked to lower cannibalization. Also examined is the impact of pack-size cannibalization on promotion profitability for retailer PLs. That analysis finds PL price promotions have generally negative impacts on PL profits, and that pack-size cannibalization exacerbates this negative outcome. The results suggest both retailers and manufacturers should carefully consider pack-size cannibalization when evaluating the outcome of temporary price promotions. The study also provides some evidence-based recommendations from which managers can attempt to minimize such cannibalization.     

Promotional Framing of Green Products: Mediating Role of Sale Proneness

Abstract

The impact of sales promotion in boosting short-term sales is well established in the literature. While there are ample studies on the impact of sales promotion on conventional products in western countries, there is very scant research on the effect of promotions on green products and almost nonexistence research in emerging economies. This research addresses this gap by doing a comparative assessment of economically equivalent bonus pack sales promotion and price discount sales promotions on green versus non-green products through two experiments designed as a 2 (green product motivation: hedonic vs. utilitarian) × 2 (promotional frame: price discount vs. bonus pack) × 2 (discount level: low vs. high) between-subjects study, and 2 ( product types: green, non-green/control) × 2(promotional frame: price discount, bonus pack) between-subjects study. This research further examines the mediating role of sale proneness in the purchase process. The findings of this research indicate that buyers' preferences for promotion are quite varied for the purchase of green versus non-green products, and the price discount increases sale proneness which exerts a negative impact on product purchase willingness. Accordingly, this study has some theoretical and practical implications.     

Allocating a Promotion Budget between Advertising and Sales Contest Prizes: An Integrated Marketing Communications Perspective

This paper develops and analyzes a normative model for allocating a fixed, short-term promotion budget between product advertising and prizes of a rank-order sales contest for a homogeneous sales force when sales are driven by both personal selling effort and advertising. The model provides insights into how the optimal budget allocations vary with the synergy between advertising and selling effort, sales force size, salesperson risk-tolerance, perceived cost of effort, selling effectiveness and sales response uncertainty. The analysis highlights the need for and value of close coordination between marketing and sales management in designing a promotion program involving both advertising and sales force incentives.     

Schemas determining the incentive value of sales promotions

There are three types of schemas for evaluating sales promotions: schemas using cognitive algebra, schemas analogous to perceptual processes, and simple nonalgebraic heuristics. Each type of schema requires different information to evaluate a promotion. The schema a consumer uses to evaluate a promotion may therefore determine whether or not the promotion is seen as valuable. The effects of salespeople, product type, and the consumer's situation on the schemas used to evauate promotions are discussed.     

The effects of sales promotion strategy,product appeal and consumer traits on reminder impulse buying behaviour

This article investigates factors of marketing communications and consumer characteristics that induce reminder impulse buying behaviour. Study 1 applies the antecedent, process and consequence approach to investigate the essential differences between reminder impulse buying and pure impulse buying. The results of Study 1 reveal that reminder impulse buying significantly differs from pure impulse buying on motivation, buying goal and decision evaluation. Study 2 further examines how sales promotion strategy might affect reminder impulse buying, with product appeal and consumer traits as moderating factors. Both sales promotion strategy and its interaction effects with product appeal are found to have significant influences on reminder impulse buying. Specifically, an instant‐reward promotion promotes stronger reminder impulse buying than a delayed‐reward promotion. Furthermore, both a utilitarian product appeal with a price discount promotion and a hedonic product appeal with a premium promotion can encourage greater reminder impulse buying.     

Effects of sales promotion type and promotion depth on consumer perceptions: the moderating role of retailer reputation

This study uses a between-subjects experimental design to test the effect of two sales promotion formats (coupon versus markdown) with either high and low face values on consumer attitudes toward the deal, perceived product quality, and purchase intentions. The reputation of the retailer offering the deal is predicted to moderate the relationship between the promotional offer and consumer responses. Consumers perceive product quality to be higher when offered a high value coupon vs. markdown but there is no significant difference in perceived quality across promotion types when the promotion face value is low. When a deep price discount is offered by a retailer with a negative reputation, however, consumers have more favorable attitudes toward the deal and higher purchase intentions when provided with a markdown vs. coupon. Conversely, a high value coupon elicits more favorable evaluations than a markdown when the retailer has a positive reputation. When the value of the promotion is low and the retailer has a positive reputation, consumers have more positive deal attitudes and purchase intentions when offered a markdown vs. coupon. There is no significant difference in the effects of promotion type when the retailer has a negative reputation. The findings therefore establish retailer reputation as an important moderator of sales promotions effectiveness. This research is limited by the use of a single product category and a student sample. Process measures are also needed to validate the proposed theoretical conceptualization. The results provide managers insight into the type and value of the sales promotion to offer based on consumer perceptions of the retailer's reputation in the market.     

An Assessment of When,Where and Under What Conditions In-Store Sampling is Most Effective

In-store product sampling is a commonly used promotional technique designed to give prospective consumers an opportunity to experience a product prior to purchase. While prior research has documented a positive relationship between short-term sales and perceptual measures of the customer shopping experience, little is known about the long-term impact of sampling or factors that moderate its success. In this paper, we develop an empirical approach that allows us to study the short-term and long-term effects of in-store sampling on both own and competitive products. We apply our approach to six store-level scanner data sets across four different product categories and show that in-store sampling has both an immediate (short-term) and sustained (long-term) impact on sales. We also show that the impact of sampling on sales is moderated by the characteristics of the store conducting the event, and that repeated sampling for a single product leads to a multiplicative increase in its long-term sales performance. We find that, unlike many types of in-store promotion, sampling results in a category expansion effect as opposed to a pure substitution effect. We contrast the immediate and long-term sales patterns for in-store sampling to those of product displays and discuss managerially relevant differences. Finally, we demonstrate incremental profit implications and store selection scenarios for different incremental costs of conducting the in-store events using constrained optimizations.     

Vogue in Britain: Authenticity and the creation of competitive advantage in the UK magazine industry

By 1914 the leading British magazine publishers had successfully launched a range of popular weekly titles for female readers which focused on everyday women's fashions. In contrast, the British operations of American publishers Hearst and Condé Nast sought to develop high-quality magazines designed to attract affluent consumers – and the advertisers who sought to reach these readers. This paper argues that the success of Condé Nast's Vogue depended on two main factors: gaining authenticity in the world of high fashion and forming close relations with their customers – both readers and advertisers – using market research and promotion techniques transferred from the United States.     

Do Sexy Cover Models Increase Magazine Sales?

Abstract

In the competitive struggle to increase circulation, mainstream men's magazines (such as Details, Maxim, Esquire) are featuring sexually attractive people on their covers. This article reports the findings of a study designed to determine if the sexual response evoked by cover models is related to interest in the magazine and purchase intention. Findings suggest that sexual attractiveness of the cover model and sexual arousal were related to interest in the magazine, but not purchase intention. Although no gender differences emerged, those with a positive sexual response to the cover person were more interested in the magazine. These results suggest that sexy cover models may be most effective for attracting attention to, and interest in, the magazine at the newsstand, but that feature articles have greater impact on purchase decisions.     

The British house magazine 1945 to 2015: The creation of family,organisation and markets

Abstract

This article examines the history of British house magazines from 1945 to 2015. It discusses their content, audience and function within companies. From tools of internal public relations, house magazines switched to being used as mediums of industrial relations in the 1960s and 1970s, and by the late 1980s were increasingly applied to the creation of corporate identity, organisational culture and internal marketing. They were also forced to accommodate the rise of internal communications and electronic media. The article discusses the rise and relative decline of the British house magazine, and ends by asking whether it has a future.     

The effects of promotional package frames and price strategies on inaction inertia

Inaction inertia is the phenomenon in which people are less likely to accept a less attractive opportunity after having missed a relatively more attractive one. Previous studies have mainly explored the inaction inertia effect on single products or services, whereas this study explored how the promotional frames of sales packages influence inaction inertia toward the individual items within the sales packages and the inaction inertia effect of the target product under different price strategies. On the basis of the cost assignments of mental accounting and comparisons of the current inferior promotion with missed superior promotion, this study found evidence that when consumers encounter a freebie (bundle) condition, they assign a higher cost to the focal (supplementary) product and a lower cost to the supplementary (focal) product. Therefore, consumers who have missed a freebie (bundle) promotion exhibit lower (higher) inaction inertia toward the focal product, but higher (lower) inaction inertia toward the supplementary product. Applying a similar internal mechanism to pricing strategies, the findings also show that when consumers encounter a two‐component sales package with a surcharge promotion using a partitioned price (vs. a price discount promotion using an all‐inclusive price), they assign a higher cost to the base product and a lower cost to the surcharge. So, consumers who have missed the surcharge (vs. price discount) promotion show higher inaction inertia when the surcharge of the current inferior opportunity is salient, but show less inaction inertia when it is not salient. Moreover, the percent of a surcharge as a part of the total package value moderates the impact of promotional price strategy frames on inaction inertia. These findings have significant implications for both theoreticians and practitioners interested in inaction inertia, promotional frames, and price strategies.     

An Examination of the Incidence of Purchase Quantity and Timing Acceleration

One potential cause of sales increases for consumer nondurables during promotional periods is purchase acceleration. That is, a promotion may cause consumers to buy larger quantities of a product (quantity acceleration) and/or purchase the product sooner than they normally would (timing acceleration). A number of stud- ies, using a number of different types of products and consumer promotions, have examined the phenomenon but the results have not consistenlly shown that purchase acceleration occurs or is large enough to be perceptible. This study, using rather strict definitions of quantity and timing acceleration, finds evidence of considerable purchase quantity and timing acceleration by households in four product categories. These findings suggest that manufacturers may be overestimating the prof- itability of their promotions. A portion of the sales increase in promotional periods has been borrowed from future periods, where presumably some of the purchases would have been non-promo- tional, higher-margin purchases.     

Product information and consumer choice confidence in multi-item sales promotions

This research augments efforts to produce a richer understanding of the drivers of consumer choice confidence. It examines the interplay between two marketing interventions that consumers encounter in retail marketplaces, diagnostic product information and multi-item sales promotions. Results indicate that the influence of product information varies as a function of sales promotion format. The information effect is weaker when consumers are allowed to select the products that will be included in the promotion. Perception of information adequacy is revealed as a mediator of the information diagnosticity effect. The implications for marketing theory and promotional strategy are discussed.     

Impact of Shari’ah on Consumers’ Behavior Toward Sales Promotion Tools: Focus on Egyptian Convenience Products

This study measures to what extent compliance with Shari’ah moderates the relationship between different sales promotion tools—namely, price discount, product demonstration and sampling, buy one get one free (bonus pack), sweepstakes/lucky draws, scratch and win offers, and free samples—and three consumer behavioral responses (product trial, stockpiling, and spending more) for buying convenience products from supermarkets in Egypt. A total of 381 selected Muslim consumers/shoppers were surveyed via face-to-face interviews using a structured questionnaire. Overall correlation analysis between the six proposed sales promotion tools and consumers’ response behavior in general demonstrated a significant relationship. However, some specific tools did not indicate a significant relationship with specific response behaviors. Furthermore, correlation analysis initially indicated that there is a positive significant relationship between all sales promotion tools and compliance with Shari’ah, with the exception of sweepstakes and scratch and win offers, which demonstrated a significant negative relationship. Furthermore, after running linear stepwise regression, the model was fit (62%), indicating the moderating role of compliance with Shari’ah in the relationship between specific sales promotion tools—namely, sweepstakes/games and scratch and win offers—and Muslim consumers’ behavioral responses. Generally speaking, marketers should consider Shari’ah and ethical principles in Islam before creatively crafting promotional tools to attract Muslim consumers, and new tools could be developed with an Islamic orientation to attract Muslim consumers.     

Online marketing: When to offer a refund for advanced sales

Advance selling is a marketing strategy commonly used by online retailers to increase sales by exploiting consumer valuation uncertainty. Recently, some online retailers have started to allow refunds on products sold in advance. On the one hand this reduces the net advance sales, but on the other hand it allows a higher advance sales price. This research is the first to explore the overall effect of allowing a refund on profits from advance sales, identifying conditions where advance selling with or without refunds (or no advance selling at all) is best. We analytically compare the profits of three advance selling strategies: none, without refund, and with refund. We show that selling in advance and allowing a refund is optimal for products with a relatively small profit margin and small strategic market size, and that the added profit can be considerable. Our results guide managers in selecting the right advance selling strategy. To facilitate this, we graphically display, based on the two dimensions of regular profit margin and strategic market size, under what conditions the different strategies are optimal.     

Celebrity Endorsements in U.S. and Thai Magazines: A Content Analysis Comparative Assessment

SUMMARY

Celebrity endorsements have become a prevalent form of advertising. Hence, the purpose of the study was to determine the relationship between the use of celebrities and the types of products endorsed. Advertisements from one popular magazine in the U.S. and 2 popular magazines in Thailand were used. Results indicated that U.S. advertisements of beauty, dietary and health services, hospitals, and weight loss clinics categories utilized celebrity endorsements more often than other categories. In Thai advertisements, supplementary foods and medicines used celebrity endorsers more often than other categories. Results further support that a significant relationship exits between celebrity endorsers and product types.     

Quality-cum-price sorting

This paper provides new evidence on how export status relates to prices and product quality. Using firm-product-level data on production, exports and imports for a sample of Danish manufacturing firms, we present three key correlations. First, exported varieties are on average sold at lower prices relative to only domestically sold varieties. Second, exported varieties have higher quality measured by ‘demand residuals’ (i.e., they have larger sales conditional on price). Finally, exported varieties are produced using cheaper imported intermediates. We introduce the term ‘quality-cum-price sorting’ to describe this sorting environment. The observed sorting behaviour in terms of output quality and import prices works not just across firms, but also within multi-product firms across the product portfolio. In contrast, the negative exporter premium in terms of output prices vanishes once firm-level unobservables are accounted for—consistent with the idea that unobserved firm efficiency is driving the negative correlation.