Price segment stability in consumer goods categories

Abstract

Purpose

This paper sets out to explore the degree to which consumer price segments can be generalized across product categories.

Design/methodology/approach

A comprehensive segmentation framework of price‐related activating and cognitive inner processes and preferences is proposed to account for heterogeneity in consumer response to price. Large‐scale consumer survey data on price‐related attitudes in eight consumer goods categories (paper tissue, soap bar, chocolate bar, detergent, facial moisturizer, television set, washing machine, jeans) are used for cluster analysis.

Findings

On the aggregate level, five stable price segments across consumer goods categories are identified and described. On the individual level, it is found that price behavioural consistency is a function of the category context in terms of price uncertainty and quality uncertainty.

Practical implications

The findings suggest that price management should be concerned with price segment structures and their specific price needs. Price segmentation could particularly benefit retailers in order to increase the effectiveness and efficiency of consumer targeting.

Originality/value

The contribution of the study is to show that identical price segments can be identified across categories, whereas the individual segment membership depends on the nature and level of perceived risk in the category.

Citation

Stamer, H.H. and Diller, H. (2006), "Price segment stability in consumer goods categories", Journal of Product & Brand Management, Vol. 15 No. 1, pp. 62-72. https://doi.org/10.1108/10610420610650882