This study applies the first order Markov process to examine the relative impact of the purchase feedback and nonfeedback effects on market share. Based on the first order Markov brand switching model, this study applies the least square method to estimate the nonfeedback effect based on historical consumer panel data for market share and loyalty. Applying this approach to data from the consumer panel in the three product categories of adult milk powder, shampoo, and detergent provided by TNS Global Taiwan in 2003, reveals that the influence of the nonfeedback effect on market share exceeds that of the purchase feedback. Restated, for adult milk powder, shampoo, and detergent, consumer brand choice is easily affected by promotional activities such as advertising or price. The impact of the purchase feedback owing to purchase experience of a particular brand (satisfaction and then loyalty) is less than that of the nonfeedback effect.
關聯:
Journal of Information and Optimization Sciences 32(4), pp.799-810
