Insights into cross- and within-store price search: retailer estimates vs. consumer self-reports

By Joel E. Urbany, Peter R. Dickson, Alan G. Sawyer. 2000

122 citations recorded by the source corpus.

Past research of the accuracy of retail grocers’ beliefs about consumer search and patronage behavior has found that executives tend to overestimate the size of the consumer segment that regularly switches stores for price specials. With surveys of consumers and executives in a large midwestern market, we extend and replicate the earlier research. In this study, we find that executives demonstrate, on average, an accurate sense of the proportion of consumers who are primarily loyal to one store or are shoppers of multiple stores. However, they still tend to overestimate aggregate price comparison behavior and cross-store shopping. At the same time, we also find that managers simultaneously underestimate consumer newspaper readership, in-store search for specials, and stockpiling. This new result suggests that the more loyal primary customers may account for a greater proportion of incremental promotional sales than has been recognized in the past. These results suggest a significant increase in the information value to be derived from the desegregation of sales data by shopper loyalty status.

Subfields: Economics and Econometrics, Marketing

View Paper: https://www.semanticscholar.org/paper/d658cdfec5fd63af815512611f3503b78cc4c49e

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Citations in the corpus

Food quality and safety: consumer perception and demand (2005, background): “First, there is a good deal of research showing that consumers routinely buy lots of products without knowing their prices (e.g. Chernatony and Knox, 1992; Urbany et al., 2000; Vanhuele and Drèze, 2002).”
Do Promotions Benefit Manufacturers, Retailers, or Both? (2002, background): “Overall, our store impact findings are consistent with prior arguments that retail grocery managers overestimate the extent of cross-store shopping and the impact of price promotions on store traffic, thereby pricing more aggressively than warranted (Urbany et al. 2000).”
The Temporal and Spatial Dimensions of Price Search: Insights from Matching Household Survey and Purchase Data (2008, unknown): “…only surveys of stated household purchase behavior (e.g., Putrevu and Ratchford 1997; Urbany, Dickson, and Kalapurakal 1996; Urbany, Dickson, and Sawyer 2000) or only field or scanner data on observed household purchase behavior (e.g., Carlson and Gieseke 1983; Mace and Neslin 2004;…”