MAKING THE CUT - MODELING AND ANALYZING CHOICE SET RESTRICTION IN SCANNER PANEL-DATA

The authors develop an approach to determine and analyze choice set re striction on the basis of secondary source information on consumer pur chase histories. Individual-level choice sets are estimated using a Ba yesian updating procedure in conjunction with the multinomial legit mo del, The authors apply the procedure to scanner panel data for the liq uid laundry detergent category. An analysis of estimated choice sets a cross panelists reveals that market share does not ''go hand-in-hand'' with choice set share (the percentage of choice sets in which a brand is a member), Examining choice set membership patterns, such as the c ooccurrence of brands in the same product line, also provides insight into sister-brand cannibalization. Estimation results also show that p romotions can expand choice sets, providing excluded brands a means to gain entry and long-term sales benefits.