Testing the Double Jeopardy Loyalty Effect Using Discrete Choice Models
- Labeaga Azcona, José María 23
- Lado Cousté, Nora 4
- Martos Partal, Mercedes 1
- 1 Universidad de Salamanca. Dpto. Administración y Economía de la Empresa, Campus Miguel de Unamuno, 37007 Salamanca, Spain
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2
Universidad Nacional de Educación a Distancia
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- 3 FEDEA
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4
Universidad Carlos III de Madrid
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ISSN: 1696-7496
Year of publication: 2007
Issue: 21
Pages: 1-22
Type: Working paper
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.