An Analysis of Assortment Choice in Grocery Retailing |
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| Institution: | 1. School of Marketing, Faculty of Business, University of Technology, Sydney, Australia;2. School of Business, University of Washington, Bothell, United States;3. Tippie College of Business, University of Iowa, United States;1. Department of Marketing, Martin J. Whitman School of Management, Syracuse University, 721 University Avenue, Syracuse, NY 13244, United States;2. Department of Marketing, University of Florida, P.O. Box 117155, Gainesville, FL 32611-7155, United States;1. Owen Graduate School of Management, Vanderbilt University, Nashville, TN 37203, United States;2. Jindal School of Management, The University of Texas at Dallas, Richardson, TX 75080, United States;3. School of Business, Renmin University of China, Beijing, China;1. Graduate School of Business, Fordham University, United States;2. Department of Marketing & Supply Chain Management, Fogelman College of Business and Economics, The University of Memphis, Memphis, TN 38152, United States;3. Industrial Marketing Unit, Department of Industrial Economics & Management, School of Industrial Engineering and Management, Royal Institute of Technology, Lindstedtsvägen, Stockholm, Sweden;1. Marketing Department, Marshall School of Business, University of Southern California, 3660 Trousdale Parkway, Room ACC 306E, Los Angeles, CA 90089-0443, United States;2. Marketing and Consumer Behaviour Group, Wageningen University, Postbus 8130, 6700 EW Wageningen, The Netherlands;3. Marketing Department, Katz Graduate School of Business, University of Pittsburgh, 364 Mervis Hall, Pittsburgh, PA 15260, United States;1. The Belk College of Business, The University of North Carolina at Charlotte, 249A Friday Building, 9201 University City Boulevard, Charlotte, NC 28223-0001, United States;2. College of Business Administration, Kansas State University, 201B Calvin Hall, Manhattan, KS 66503, United States;1. Owen Graduate School of Management, Vanderbilt University, Nashville, TN 37203, USA;2. McDonough School of Business, Georgetown University, Washington, DC, USA;3. Marriott School of Management, Brigham Young University, Provo, UT 84602, USA;4. Nova School of Business and Economics, Universidade Nova de Lisboa, Portugal |
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| Abstract: | Consumers in grocery retailing commonly buy bundles of products to accommodate current and future consumption. When all products in a particular bundle share common attributes (and are selected from the same product category), the consumer is said to assemble an assortment. This research examines the impact of assortment variety on the assortment choice process. In particular, we test the prediction that consumers demand less variety for higher quality items. To investigate this relationship, we employ a flexible choice model, suitable for the analysis of assortment choice. The model, based upon the assumption that the utility of purchase of one item in an assortment depends upon the set of items already selected, allows for a general utility structure across the assortment items. We apply the model to household assortment choice histories from the yogurt product category. Substantively, we show that yogurt choice is affected by brand quality perceptions (quality-tier competition). Moreover, we show that reaction to reductions in variety (number of yogurt flavors) is mediated by brand quality perceptions. Taken together, these empirical facts paint a picture of a consumer who is willing to trade-off variety against product quality in assortment choice. |
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| Keywords: | Assortment choice Variety Quality perceptions Bundle models Multivariate logistic model |
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