Assessing the effects of assortment and ambience: A choice experimental approach

Elaborating on Betancourt and Gautchi, we formulate and test effects of con sumption goal, retail assortment composition, and other distribution servic es on in-store purchase decisions. By using the extended legit model we exp lain the utility of an item as a function of assortment characteristics, wh ich allows capturing substitution, complementarity and asymmetric dominance effects. A choice experiment manipulates assortment composition, prices, s tore ambience, competing store features, and purchase goal. In an applicati on to florist stores we find that in-store purchase decisions are affected by the size and composition of the assortment and by the presence of a comp eting store, but not by ambience. We find substitution effects between powe rs of the same variety, but not for all varieties. Effects differ between c onsumption goals.