Title

Consumers' SKU choices in an online supermarket : a latent class approach

Document Type

Journal article

Source Publication

Journal of Marketing Management

Publication Date

5-1-2010

Volume

26

Issue

5/6

First Page

495

Last Page

514

Keywords

Internet retailing, consumer loyalty, stock keeping unit (SKU), online supermarket, discrete choice model

Abstract

This study examines the effects of loyalty and e-marketing mix variables on the choices of online consumers at the stock-keeping-unit (SKU) level. Using a panel dataset from an online supermarket, we estimate a discrete choice model of a frequently purchased product; generate the refined smoothing constants of the loyalty variables for brand, size, and SKU; and adopt the latent class approach to address consumer heterogeneity. The findings suggest that SKU loyalty is a better predictor of consumer choices than brand and size loyalty. Although online consumers are not sensitive to the net prices of SKU alternatives, they are attracted to price promotions. While webpage display has little effect on SKU choices, speedy delivery has a positive impact. The latent class approach significantly improves model fitness and classification accuracy. Analysing consumer choices at the SKU level can help online supermarkets with promotion planning and inventory and distribution management to improve customer satisfaction and profitability.

DOI

10.1080/02672570903534704

Print ISSN

0267257X

E-ISSN

14721376

Publisher Statement

Copyright © 2010 Westburn Publishers Ltd

Access to external full text or publisher's version may require subscription.

Full-text Version

Publisher’s Version

Recommended Citation

Cui, G., & Wang, Y. (2010). Consumers' SKU choices in an online supermarket: A latent class approach. Journal of Marketing Management, 26(5/6), 495-514. doi: 10.1080/02672570903534704