Keyword

Consumer behavioural evolvement, behavioural segmentation, promotion, exploration and exploitation, retailing, store scanner data.

Abstract

Consumers treat and react to promotions diversely in terms of their promotion proneness and variety seeking tendency. This paper investigates 589 consumers with 169678 transaction records in the US salt-snack market ranging from year 4 to year 7 in IRI Market Dataset for exploring how their purchase behaviours evolve in the consumer life cycle. A set of algorithms is presented to process store scanner data for measuring consumers’ promotion proneness and variety seeking tendency, which are then used for conducting clustering analysis. Four types of purchase behaviours including “Promotion averse”, “Bargain hunters”, “Opportunistic explorers”, and “Opportunistic exploiters” are identified and assigned accordingly for each consumer in each year. Even though consumers’ purchase behaviours will dynamically and freely shift within or among those four behavioural segments over time, two clear behavioural evolvement patterns can be identified statistically in the consumer life cycle. In the US salt-snack market, some consumers who are initially not sensitive to promotions will gradually evolve to take advantage of promotion to try alternatives for extending their market knowledge. Some explorers’ promotion proneness will gradually increase and outweigh their variety seeking tendency over time, thus, those opportunistic explorers become inclined to buy any brands on promotion. In contrast, consumers who initially prefer to buy their familiar brands will become m


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