Consumer response to the preferred brand out‐of‐stock situation

Abstract

The goal of this study was to gauge brand loyalty. To do this, a brand loyalty acid test was used, which involved an out‐of‐stock (OOS) experiment where the complete product line of a brand was removed from several stores in order to estimate the OOS responses of consumers. Three types of OOS responses were identified: switching brands; switching stores to get one’s favorite brand; and postponing purchase of a specific brand. The present study revealed that the brand loyalty of the consumers participating in the OOS experiment was substantial, as a large percentage of them switched stores or postponed purchase. The study also showed that neither competitive conditions of the retailer nor assortment change had any effect on consumers’ OOS responses. The most potent variables that affected OOS responses were the way consumers organized their shopping trips: store loyals more than others switched stores by OOS; and consumers with a small purchase amount per shopping trip were less likely to switch stores and more likely to postpone purchase. There also was a slight tendency for the consumer to spend less in the store during the OOS period. This paper suggests the implications of these findings for retailers and manufacturers.

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