publication . Article . 2004

Consumer Learning, Brand Loyalty, and Competition

J. Miguel Villas-Boas;
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  • Published: 01 Jan 2004 Journal: Marketing Science, volume 23, pages 134-145 (issn: 0732-2399, eissn: 1526-548X, Copyright policy)
  • Publisher: Institute for Operations Research and the Management Sciences (INFORMS)
Abstract
In several markets, consumers can gain further information regarding how well a product fits their preferences only by experiencing it after purchase. This could then generate loyalty for the products tried first. This paper considers a model in which consumers learn in the first period about the product they buy and then make choices in the second period about the competing products, given what they learned in the first period. The paper finds that if the distribution of valuations for each product is negatively (positively) skewed, a firm benefits (is hurt) in the future from having a greater market share today—the brand loyalty characteristic. With negative s...
Subjects
free text keywords: consumer learning, brand loyalty, dynamic competition, experience goods, lifetime value of customers, forward-looking consumers, forward-looking firms, Marketing, Business and International Management, Brand loyalty, Economics, Skewness, Valuation (finance), Consumer learning, Loyalty, media_common.quotation_subject, media_common, Market share, Microeconomics
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publication . Article . 2004

Consumer Learning, Brand Loyalty, and Competition

J. Miguel Villas-Boas;