Abstract
The cost of food in Mexico has increased over several decades while modern retailers face intense rivalry. Currently, consumers have several choices for buying food, which prompts retail managers to implement pricing strategies designed to differentiate from competitors and attract more customers. The problem is that several retailers seem to be using the same approach without a clear understanding of consumer price sensitivity, the effect of non-price promotions, and the variations across retail formats. This research will address these issues by analyzing scanner sales data and mystery shopper price reports to calculate price sensitivity across six food categories sold in four retail chains. Results indicate that product demand, in most food categories, is sensitive to price changes at big-box retail competitors and not traditional supermarket retailers. Additionally, results indicate that the six food categories in the study are sensitive to feature advertising. Retail managers can use these findings to help define their value propositions, focus their pricing strategies, and inform their marketing communications strategy.
© 2018, Facultad de Contaduría y Administración, Universidad Nacional Autónoma de México. All rights reserved. Publication of the article implies full assignment of property rights (copyright) in Journal of Contaduría y Administración. The publication mreserves the right to total or partial reproduction of the work in other print, electronic or any other alternative means, but always recognizing its responsibility.
License for Published Content
Unless otherwise stated, all contents of the electronic edition of the journal are distributed under a license and distribution "Creative Commons Attribution-Noncommercial 4.0 International" (CC-by). You can see from here the version of the license information. This circumstance must be expressly stated in this way when necessary.
Metadata License
The metadata of papers published by Contaduría y Administración are in the public domain, through the publisher's waiver of all rights to the work under copyright law worldwide, including all rights and related rights, to the extent permitted by law. You may copy, modify, and distribute the metadata, even for commercial purposes, without requesting permission.
