Customer Preferences Of Product And Channel Preferences Essay
While planning product assortment, nowadays retailers considers a number of factors such as consumer preferences of product and channels, and consumer perception and behavior across different channels. Inappropriate assortment gathered by retailers will avert customers and thus resulting in loss of current and future revenue earning options. Hence, assortment planning is still one of the most important decision for retail houses (Mantrala et al. 2009).
In this section, we will look into the research studies done on each of these factors.
Customer preferences of product and channel
Different customers have different product assortment and channel preferences. In certain situations, it is beneficial to have a prior selection of product line design of some good products from a large number of feasible products but this will eventually lead to a suboptimal product line assortment. (Green and Krieger 1985). This can be attributed to the fact that consumers cannot accurately predict changes in their tastes for future (Kahneman and Snell 1992). Sometimes customer preferences can reflect past choices. As the customers become used to the attributes of a particular product, their preference may shift towards a product having more attributes than the present one. (Macalister, Leigh 1982). Consumers tend to vary their use of decision rules and hence they demand flexibility in assortment within a choice set. (Drolet 2002). All these factors combined contribute…