The purpose of this study is to investigate multiple store patronage. Specifically, the aim is to relate the number of stores patronized to a set of consumer characteristics and market structure factors, according to a cost–benefit approach. Data from a sample of 1000 shoppers indicate that only few consumer characteristics impact on multi-store patronage pattern for grocery purchases (gender and shopping activity perception). Moreover, the number of stores operating in the market proved to be an important determinant of patronage set size. Implications for retailers are discussed with suggestions for future research.
In grocery retailing, which is a highly competitive market, store loyalty is a major challenge for retailers. One of the main behavioural components used in the literature to measure customer loyalty is the number of alternatives explored (patronage ratio) (Enis and Paul, 1970 and Burford et al., 1971). Store patronage involves several interdependent decisions, including which and how many stores to use. While perfect loyal consumers shop exclusively at their favourite store, many consumers patronize a set of competing stores. Cross-shopping behaviour is becoming increasingly common due to the growing heterogeneity of demand and proliferation of retail formats (Bustos-Reyesa and González-Benito, 2008, Kau and Ehrenberg, 1984, Knox and Denison, 2000, Morganosky, 1997, Morganosky and Cude, 2000, Rhee and Bell, 2002 and Rousey and Morganosky, 1996). Anyway, consumers who shop on a portfolio basis typically have a primary store that captures the relative majority of their purchases (Ailawadi and Keller, 2004, Flavián et al., 2001, González-Benito et al., 2005, Kau and Ehrenberg, 1984, Knox and Denison, 2000, Morganosky and Cude, 2000, Rhee and Bell, 2002 and Stassen et al., 1999). It was demonstrated that primary store choice is a relatively stable decision since most customers are unlikely to switch main store affiliation (Rhee and Bell, 2002). On the other hand, Mägi (2003) outlined that the degree of loyalty to the primary store depends on the shopper's overall patronage pattern and, therefore, on the number of stores patronized. Moreover, the extent to which secondary stores are used varies across customers (Mägi, 2003, Popkowski Leszczyc and Timmermans, 1997, Thelen and Woodside, 1997, Urbany et al., 2000 and Woodside and Trappey, 1996).
With that in mind, the purpose of this study is to investigate multiple store patronage in the grocery retailing sector. More precisely, the aim is to relate the number of stores patronized to a set of consumer characteristics and market structure factors. There have been limited previous attempts to investigate this specific issue in the literature. To our knowledge, the only attempt to empirically address the structure of multiple store patronage has been made by Baltas et al. (2010). They investigated the use of multiple stores by supermarket customers and demonstrated that the patronage set size is associated with some consumer variables. The present study extends the existing research by considering: (a) market structure factors – in addition to consumer characteristics – as they may influence multiple store shopping and thus prove to be important determinants of the patronage sets; (b) consumer mobility between stores of different store formats – in addition to consumer mobility between stores of the same format – as the intense and complex horizontal rivalry emphasizes the importance of evaluating both inter- and intra-format competition.
The proposed theoretical framework offers insights on the differences in customers’ patronage behaviour for both scholars and practitioners. In particular, from a managerial standpoint, these insights can improve segmentation and targeting strategies aimed to exploit customers loyalty potential. Focusing marketing efforts on shoppers that are predisposed to being loyal and patronize fewer stores is a more effective means of enhancing customer loyalty and store performance (Berman and Evans, 2001).
