Assessing Grocery Store Attraction via Cross-Shopping Linkages – Discussion and Managerial Implications

Limitations of the study include sample size and cell size. The current study had a 16.9% return rate based on 1,000 mailed surveys. To increase the return rate respondents were offered a chance to win a small monetary reward. The amount of the monetary reward may have been a factor in the lower response rate. In addition, K-Mart store, a discount department store, was dropped from the analysis because only two respondents indicated it was their first choice for grocery shopping. The “other” category was also dropped for the analysis. Of the 169 returned surveys 151 were useable for the analyses.
The purpose of the current study is to provide a better understanding of the retail market structure among grocery stores (i.e., intra-type competition) by assessing cross-shopping linkages. This study approached cross-shopping from the stores’ perspective. Instead of identifying differences between consumers who are or are not cross-shoppers, this study identified stores that attracted more customers from their competition making cross-shopping a store characteristic as opposed to a consumer characteristic. While previous research has identified the use of private label brands and service quality as factors associated with store loyalty; their influence on cross-shopping behavior as a store characteristic has not been addressed in the literature. This study found that cross-shopping behavior is prevalent in the grocery industry. More than 60% of respondents were found to be cross-shoppers who shop on average two different grocery stores per month. The degree of cross-shopping found in this study is supported in the literature by Uncles and Hammond’s research.
By creating a cross-shopping matrix, a measure of the stores’ probability for either attracting or sharing customers was developed. Attraction stores received more customers from their competition while sharing stores lost more of their customers to the competition. The grocery stores were then classified as either an “attraction” or “sharing” store. Use of these classifications is supported by an examination of the cross-shopping linkages. More customers identified Harris Teeter and Food Lion as a secondary store they would shop.
The statistical analysis identified several service quality variables that are significantly associated with attraction stores. No single service quality variable was found to differentiate between attraction and sharing stores. Specifically, for infrequent shoppers, attraction stores are perceived as possessing greater reliability, responsiveness, assurance, and empathy, but this perception changes as shopping frequency increases. For frequent shoppers sharing stores are perceived as possessing greater reliability, responsiveness, assurance, and empathy. The flow of customers is from stores with high service quality to stores with lower service quality. Consumers’ perceptions of the quality and value of private label brands were not found to differ between attraction and sharing stores.
These findings imply that while grocery retailers need to maintain loyalty among their current customers, they also need to be aware of how they can attract their competitors’ customers. Approximately 45% of respondents made eight or more grocery store trips per month which suggests there exists an opportunity to attract customers away from the competition by differentiating store offering. By understanding their attraction/sharing ratio store managers can make changes to their retail strategy that can pull consumers away from their competition. This study identifies the specific characteristics of service quality that can assist stores in capturing a greater share of their market.
In conclusion, by using the attraction/sharing classification it is possible for retailers to identify specific store characteristics that attract cross-shoppers away from their competitors. In the current study service quality was found to significantly increase the number of cross-shoppers attracted to a grocery store.

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