The effects of adjacent competitors and promotion on brand sales

Abstract

Purpose

This paper aims to examine the potential for adjacent brands to influence sales of a focal brand. Specifically, this paper examines whether the type of adjacent brand (market leader or non-market leader competitor) and its promotion (featuring or discounting) have an effect on sales of a focal product.

Design/methodology/approach

Store-level scanner data supplemented with in-store audits are used.

Findings

It is demonstrated that adjacent brands and their specific marketing activities influence focal brand sales in specific ways, and that market leaders have a disproportionate and different effect than other competitors on the sales of adjacent brands.

Originality/value

Recent marketing research has suggested that brand activities such as featuring and discounting and in-store environmental stimuli such as shelf allocation and displays can have an important effect on category and individual brand sales. Prior work in this area, however, has not explicitly considered the potential influence of relative shelf positions (i.e. adjacencies) on brand and category sales.

Citation

Keel, A.L. and Padgett, D. (2015), "The effects of adjacent competitors and promotion on brand sales", Journal of Consumer Marketing, Vol. 32 No. 1, pp. 43-50. https://doi.org/10.1108/JCM-02-2014-0860