Re. Bucklin et al., DETERMINING SEGMENTATION IN SALES RESPONSE ACROSS CONSUMER PURCHASE BEHAVIORS, Journal of marketing research, 35(2), 1998, pp. 189-197
The authors develop a joint estimation approach to segment households
on the basis of their response to price and promotion in brand choice,
purchase incidence, and purchase quantity decisions. The authors mode
l brand choice (what to buy) by multinomial legit, incidence (whether
to buy) by nested legit, and quantity (how much to buy) by poisson reg
ression. Response segments are determined probabilistically using a la
tent mixture model. The approach simultaneously calibrates sales respo
nse on two dimensions: across segments and the three purchase behavior
s. The procedure permits market-level sales elasticities to be decompo
sed by segment and purchase behavior (i.e., choice, incidence, and qua
ntity). The authors apply the approach to scanner panel data for the y
ogurt category and find substantial differences across segments in the
relative impact of the choice, incidence, and quantity decisions on o
verall sales response to price.