Consumer response to retail stockouts

The result for Urgency is equally intuitive. The higher the urgency to purchase the item, the more likely that the consumer will substitute, because there is no time to elect one of the alternative courses of action of delaying the purchase or leaving the store. Results for Upset show that the more upset the consumer, the lower the likelihood to substitute the item and thus reward the store with a purchase.

The next finding concerning the probability of substitution requires a more thorough analysis. The variable Brand Loyalty is directly related to the probability of substituting an item in response to a stockout. That is, more brand loyal consumers are more likely to substitute the item in response to a stockout. Our prior expectation was that brand loyal consumers would be more likely to either leave the store to look for the preferred brand at another store or to delay the purchase until the stockout condition was corrected. To understand this apparent conflict, we reexamined the data and verified the items that brand loyal consumers bought in substitution of the out-of-stock item. In 40% of the cases, the purchase was a different item of the same brand.

Table 8 presents results concerning the probability that consumers will respond to a stockout condition by delaying the purchase. Recall that the coefficient in the table refers to the change in the probability that a consumer will delay a purchase given a marginal change in the independent variable. Results suggest that four variables have a significant effect on the probability of delay: Store Prices, Urgency, and Surprise (at the .05 level), and Pre-Visit Agenda (at the . 10 level).

The direction of the relationship between each of these variables and SDL behavior is intuitive. Consumers who perceive that the store has lower prices are more likely to delay the purchase, possibly because they expect to pay more elsewhere. It is important to note that the value of the coefficient for this variable is high. A one unit improvement in the perception of store prices increases the probability of delaying the purchase by more than 11 %.

The variable Urgency is also significant. Consumers are also more likely to delay the purchase when the urgency to purchase the product is low. The result for variable Surprise suggests that the less surprised with the stockout, the more likely that the consumer will delay the purchase. The coefficient for Surprise is also high. A one unit increase in Surprise decreases the probability of delay by more than 12%.

Finally, as one would expect, consumers who had a pre-visit agenda are more likely to delay the purchase. These consumers may have had an item in mind because it was being promoted, because it had a particularly good price or because the consumer had a specific need for it. Whatever the motivation, the need itself explains the behavior of delaying the purchase until the item became available.

Table 9 suggests that only two variables are significant in estimating the probability that a consumer will respond to a stockout by leaving the store. As in the case of the previous behaviors of substitution and delay, perception of store prices was significant. Consumers who perceive store prices to be lower than the competition are less likely to leave the store. The coefficient for Store Prices indicates that the impact of a one unit improvement in the perception of store prices will decrease the probability of a consumer leaving the store by almost 17%. The other significant variable was Surprise. Results suggest that consumers who are surprised by the stockout are more likely to leave the store. The coefficient indicates that a one unit increase in Surprise will increase the probability of leaving the store by 14%. An example of this behavior is consumers who expect to find the item because it was advertised in that day's newspaper.