Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments April 24, 2022 erstellt
Description:
We systematically study market share and product assortment dispersion of national brands in 25 consumer packaged goods industries across 199 markets and 109 retailers in the US. Previous findings by Bronnenberg et al. (2007, 2009) highlight the persistent differences in market shares of national brands across markets. We use the same categories as Bronnenberg et al. (2007), and investigate the role of retailers in explaining the dispersion. We first document stylized facts that the distribution of national top brand shares are asymmetric across retailers, even for retailers competing in the same geographic market. The average across-market across-retailer inter-quartile range of the top brand shares is smaller than that within-market across-retailer. The “share advantage” that a leading brand enjoys within a retailer is persistent across markets where the retailer is present and stable over time. We then specify and estimate a variance decomposition model to decompose the total variance in national brand shares and assortments into a Brand × Retailer component and a Brand × Market component. We find that 50% to 60% of the total variance is accounted for by the Brand × Retailer component, while the Brand × Market component only explains about 10% to 20% of the total variance. Our results suggest that the large market share dispersion of national brands is caused by strong asymmetries in how these brands are presented in different retailers, even under similar market conditions. Finally we provide evidence that long-term vertical relationships between retailers and manufacturers is a key explanation for the strong asymmetries in national top brand shares across retailers