Asymmetric competition in retail store formats: Evaluating inter- and intra-format spatial effects |
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Authors: | Óscar González-Benito Pablo A Muñoz-Gallego Praveen K Kopalle |
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Institution: | a Dpto. Administración y Economía de la Empresa, Universidad de Salamanca, Campus Miguel de Unamuno, 37007 Salamanca, Spain b Tuck School of Business at Dartmouth, 100 Tuck Hall, Hanover, NH 03755, USA |
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Abstract: | Our study aims to analyze the role of store format in retail competitive interactions, specifically, the relationship between growth, location strategy, and market response. To assess this relationship, we propose an extension of the classic models of spatial interaction, which incorporate the asymmetric competitive effects linked to the concept of store format. An empirical application allows us to confirm greater spatial rivalry within store formats (intra-format) than between store formats (inter-format). This implies a certain hierarchical organization when consumers select a retail store, first choosing the type of store at which they will shop and later a particular store within this format. The results are important for retailers who want to configure an optimal network of store locations as well as public administrators who must regulate commercial activity. |
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Keywords: | Retail store format Spatial analysis of demand Inter-format competition Intra-format competition |
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