What factors moderate the effect of assortment reduction on store switching? Insights and implications for grocery brands

To delist or not to delist? Retailers such as Wal Mart in the USA and Mercadona in Spain resorted to extensive delisting (discontinuation) of national brands to cut costs, only to face a backlash from consumers who switched stores to find better alternatives. In this research, we offer insights and implications for retailers wishing to engage in assortment reduction through delisting. We investigate 14 moderators of store switching due to assortment reduction using a comprehensive survey of 2240 consumers in the USA and Spain. Some key findings are: (i) consumers in the USA are more prone to switching stores when faced with smaller assortments than those in Spain; (ii) having consumers’ favored brand in the reduced assortment is one of the strongest drivers that inhibit store switching due to assortment reduction in both countries; and (iii) rich, educated consumers are more likely to switch in the USA due to assortment reduction while older consumers with large families are likely to switch in Spain. These and other findings call for some common and some distinct delisting strategies in the two countries.