Abstract:

Consumers tend to have a higher evaluation and purchase intention toward the products with stronger brands. Compared to foreign products, Chinese alternatives usually occupy a weaker brand position. Hence, Chinese manufacturers who want to increase market share commonly adopt a low-price strategy. However, such strategy may greatly weaken the organization’s ability to gain profits and undermine its long-term development. Moreover, low price is likely to be used by consumers as a signal of poor quality of the products. Therefore, it is important for Chinese manufacturers with weak brands to adopt new competitive strategies. The purpose of this study was to examine how assortment structure affects consumer’s brand choice. The key hypothesis was that the manufacturers with weaker brands, rather than stronger ones, could optimize the assortment structure to affect consumers’ brand choice in a retail environment. We conducted three empirical studies to test our hypotheses. In Study 1, we conducted three separated experiments to examine the impact of the assortment structure on consumers’ perceived variety of products. In particular, Study 1a explored the main effect of the assortment structure (attribute-based vs. benefit-based) on consumers’ perceived variety. Then, studies 1b and 1c composed a Chain-of-Experiments and tested the intermediate mechanism of the construal level in the causal relationship between the assortment structure and consumers’ perceived variety: Study 1b examined the impact of assortment structure on consumers’ construal level, and Study 1c tested the impact of the construal level on consumers’ perceived variety. Study 2 investigated the causal relationship between the assortment structure and consumers’ brand choice. Studies 1 and 2 adopted a one-way between-subject design. Study 3 explored the moderating effect of consumers’ prior knowledge of brand strength in the causal relationship and used a 2 (attribute-based vs. benefit-based assortment structure) × 2 (strong vs. weak brand strength) between-subject design. As regards to the findings, compared to the benefit-based assortment structure, the attribute-based assortment structure increased consumers’ perceived variety of product, and it was the construal level that mediated this causal relationship. On this basis, the assortment structure of product influenced consumers’ brand choice in a retail environment. Meanwhile, a sequential mediation constituted by perceived variety and perceived quality mediated the effect of assortment structure on consumers’ brand choice. Finally, consumers’ prior knowledge of brand strength moderated the causal relationship between assortment structure and consumers’ brand choice. Specifically, the assortment structure affected consumers’ brand choice only when consumers initially perceived the brands as weak, rather than strong. In summary, for weak brands, the attribute-based assortment structure increased consumers’ perception of the product variety and quality, improving consumers’ brand evaluation and purchase intention relative to benefit-based assortment structure. The present research offers some theoretical and managerial implications. Theoretically, our findings suggest that the assortment structure influences consumers’ brand choice, and consumers’ prior knowledge of brand strength moderates this causal relationship. Managerially, we propose that Chinese manufacturers with weak brands can use the attribute-based assortment structure to increase their sales and market share when competing with strong foreign brands.

Key words: assortment structure, construal level, brand evaluation, brand purchase intention, prior knowledge