Testing the Double Jeopardy Loyalty Effect Using Discrete Choice Models

  1. Labeaga Azcona, José María 23
  2. Lado Cousté, Nora 4
  3. Martos Partal, Mercedes 1
  1. 1 Universidad de Salamanca
    info
    Universidad de Salamanca

    Salamanca, España

    ROR https://ror.org/02f40zc51

    Geographic location of the organization Universidad de Salamanca
  2. 2 Universidad Nacional de Educación a Distancia
    info
    Universidad Nacional de Educación a Distancia

    Madrid, España

    ROR https://ror.org/02msb5n36

    Geographic location of the organization Universidad Nacional de Educación a Distancia
  3. 3 FEDEA
  4. 4 Universidad Carlos III de Madrid
    info
    Universidad Carlos III de Madrid

    Madrid, España

    ROR https://ror.org/03ths8210

    Geographic location of the organization Universidad Carlos III de Madrid
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Journal:
Documentos de trabajo ( FEDEA )

ISSN: 1696-7496

Year of publication: 2007

Issue: 21

Pages: 1-22

Type: Working paper

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More publications in: Documentos de trabajo ( FEDEA )

Abstract

This paper attempts to validate the double jeopardy loyalty effect in a utility framework using a discrete choice approach instead of the Dirichlet model. We specify brand choice and allow for differences in brand loyalty measures across brands in two different product categories. The discrete choice model formulations include a multinomial and a latent class multinomial logit model. Using ACNielsen household scanner panel data to estimate the models, we find that market share leaders enjoy higher purchasing loyalty than do lower market share brands. The results have relevant implications in terms of marketing mix decisions for brand managers.

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