Multiple Discreteness and Product Differentiation: Demand for Carbonated Soft Drinks

DOI Web Site 2 Citations
  • Jean-Pierre Dubé
    Graduate School of Business, University of Chicago, 1101 East 58th Street, Chicago, Illinois 60637

Search this article

Description

<jats:p> For several of the largest supermarket product categories, such as carbonated soft drinks, canned soups, ready-to-eat cereals, and cookies, consumers regularly purchase assortments of products. Within the category, consumers often purchase multiple products and multiple units of each alternative selected on a given trip. This multiple discreteness violates the single-unit purchase assumption of multinomial logit and probit models. The misspecification of such demand models in categories exhibiting multiple discreteness would produce incorrect measures of consumer response to marketing mix variables. In studying product strategy, these models would lead to misleading managerial conclusions. </jats:p><jats:p> We use an alternative microeconomic model of demand for categories that exhibit the multiple discreteness problem. Recognizing the separation between the time of purchase and the time of consumption, we model consumers purchasing bundles of goods in anticipation of a stream of consumption occasions before the next trip. We apply the model to a panel of household purchases for carbonated soft drinks. </jats:p>

Journal

  • Marketing Science

    Marketing Science 23 (1), 66-81, 2004-02

    Institute for Operations Research and the Management Sciences (INFORMS)

Citations (2)*help

See more

Details 詳細情報について

Report a problem

Back to top