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Modelling the effect of store flyers on supermarket sales: An application to olive oil demand

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  • Boto-García, David
  • Alvarez, Antonio

Abstract

In this paper we study the effect of store flyers on supermarket sales while controlling for other promotional strategies. We use a dataset of weekly sales of 16 olive oil products from a Spanish supermarket chain during the year 2017. We estimate a dynamic panel data model by GMM which allows us to examine both the short- and long-run effects of displaying products in store flyers. Our estimates show that products being featured in a store flyer exhibit 85 percent higher sales in the short-run, being the effect in the long-run of 109 percent. We also provide evidence that olive oil is a highly price-elastic product. Our estimates also indicate that placing the products on the end-of-aisle increases olive oil sales. Conversely, multibuy promotions are negatively related with sales.

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  • Boto-García, David & Alvarez, Antonio, 2020. "Modelling the effect of store flyers on supermarket sales: An application to olive oil demand," Journal of Retailing and Consumer Services, Elsevier, vol. 54(C).
    • Handle: RePEc:eee:joreco:v:54:y:2020:i:c:s096969891930877x
    DOI: 10.1016/j.jretconser.2020.102057
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