Author:

Keywords:

Sales, Implications, Characteristics, Effects, Data, Supermarkets, Yield, Variables, Effectiveness

Abstract:

The authors develop a conceptual framework concerning the implications of assortment changes on category sales. They argue that the category sales effect of assortment reductions and extensions is moderated by (1) characteristics of the specific items removed or added, and (2) characteristics of the category in which the changes take place. The authors then estimate the category sales impact of additions and deletions, and test the hypothesized moderator effects in the Netherlands, using IRI / Europanel data from 1997-1998. This data set is unique in that it covers no less than 63 categories and 358 Dutch supermarkets, the richness of the database providing a broad empirical basis to test the framework and yield generalizable findings. Key variables moderating the effectiveness of assortment changes are found to be the items' uniqueness, private-label nature and display support, as well as the category's total number of SKUs, concentration, propensity to stockpile and degree of addition activity.