AN EMPIRICAL INVESTIGATION OF THE RELATIONSHIP BETWEEN COUPONS AND MARKET SHARES OF NATIONAL BRAND AND PRIVATE LABEL FOOD PRODUCTS

No other form of promotional tools can substitute coupons in promotional campaigns. Due to their unique dual impact (price discount and informational stimulant) on consumption, coupons are widely used by different manufacturers and stores. However, to the best of our knowledge, no prior research has been done regarding the analysis of the impact of coupons on market shares of national brand and private label food products. To fill this void, the goal of this study was to examine the relationship between coupons and market shares in the context of national brand and private label food products by estimating the Almost Ideal Demand System model and using the Nielsen Homescan panel data on household purchases of ready-to-eat cereal, yogurt, and spaghetti sauce from January of 2012 through December of 2014. Estimation results revealed a significant relationship between coupon values and market shares of the food product brands considered. However, the effects of coupon values on the market shares were varied for national brands and private labels. In particular, with the exception of other brands of yogurt, for national brands, market share elasticities with respect to coupon values were positive, suggesting that market share of national brands increased with an increase in coupon values. For private label of cereal and spaghetti sauce, market share elasticities with respect to coupon values were negative, indicating that an increase in coupon values led to a decline in their market shares.


Issue Date:
Jan 16 2017
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/252683
Total Pages:
18
JEL Codes:
D12




 Record created 2017-04-01, last modified 2017-04-26

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