The unbearable lightness of buying

Although marketers are increasingly asked to manage brands for the long-term, it is difficult to do so when no clear picture exists of long-term brand buying. This study reports cumulative behavioural loyalty outcomes for 200 UK consumer-goods brands when observed in a five-year household panel of continuous reporters. We examine these brands in intervals from one to five years against NBD (Negative Binomial Distribution)-model projections. Stationary brands attract over twice as many buyers in five years as they do in one. Of these buyers, 80% purchase the brand at a rate of once a year or less, yet contribute 40% to total sales, a Pareto ratio of just 60:20. For managers, this light buying is broadly predictable from NBD fittings to annual data, and implies a renewed emphasis on nudging the brand buying propensities of the whole market.
Summary Statement of Contribution
Few studies have considered brand performance cumulatively. We present new benchmarks for the developments not easily seen in annual panel data, that occur in the buyer base of stable consumer packaged goods brands over five years. These include continuing cumulative penetration growth, and a large influx of light buyers. We advance NBD theory, demonstrating how a stochastic model can still explain and project these changes from annual fittings, to link the ‘here and now’ with long term brand performance.

This is an Accepted Manuscript of an article to be published by Taylor & Francis in Journal of Marketing Management It will be available online: https://www.tandfonline.com/toc/rjmm20/current