THREE ESSAYS ADDRESSING ISSUES IN RETAIL CHANNELS

My dissertation examines the effect of several changes occurring in the retail environment. In the first essay, I study competition among retail formats. I examine the phenomenon retailers call channel blurring: consumers moving their purchases from channels traditionally associated with that category to alternative channels. At one time, different retail formats served different purposes, but they are slowly becoming indistinguishable. For example, mass merchandisers are now carrying sizeable assortments of groceries and pharmaceuticals, while drug chains such are stocking their shelves with toys and household items. I examine how consumers are responding to these changes. My results show that consumers view retail formats as substitutable, that households who are more brand loyal are also more retail format loyal, and that households who purchase private labels are also format loyal.In the second essay, I examine retail chain choice behavior at the basket level. I develop a model of retail chain choice behavior to understand what factors underlie this decision. The results show that the retailers food price image has a bigger impact than non-food price image, and that different retailers have customers who use assortment differently. Implications of this are discussed with respect to marketing mix decisions.In the third essay, I examine retail competition from a legal perspective by performing an empirical analysis of the case history of the Robinson-Patman Act. While the stated goal of the Act is to prevent price discrimination and level the playing field for small buyers, in reality the marketplace may not be not aligned with this goal. Anecdotal evidence suggests that Wal-Mart and others obtain better prices for the same goods when compared with small competitors. I find evidence that the Brooke Group Supreme Court ruling significantly decreased the probability of a plaintiff winning a Robinson-Patman case. The finding is particularly evident in primary-line cases and cases where the issue of competitive harm is addressed. Additionally, I find the importance of plaintiff resources changes after the Brooke Group ruling such that small plaintiffs are significantly more successful than large plaintiffs before Brooke Group but are significantly less successful after the ruling.