Food Quality and Preference 25 (2012) 156–162

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Food Quality and Preference

journal homepage: www.elsevier.com/locate/foodqual

Quality assurance labels as drivers of customer loyalty in the case of traditional

food products
Polymeros Chrysochou a,b,⇑, Athanasios Krystallis a, Georges Giraud c
a
MAPP, Department of Business Administration, Aarhus University, Aarhus, Denmark
b
Ehrenberg-Bass Institute for Marketing Science, School of Marketing, University of South Australia, Adelaide, Australia
c
Social Sciences & Humanities Department, AgroSup Dijon, Dijon, France

a r t i c l e i n f o a b s t r a c t

Article history: This paper examines the role of quality assurance labels as drivers of customer loyalty in the case of tra-
Received 26 July 2011 ditional food products. More specifically, it investigates whether quality assurance labels, such as the
Received in revised form 19 February 2012 Designation of origin labels (DOLs), perform as better drivers of loyalty in comparison to other brand-
Accepted 23 February 2012
related attributes, such as price and brand type, and if brands carrying a DOL exhibit higher loyalty levels
Available online 2 March 2012
in comparison to brands that do not carry any DOL label. Scanner data were collected from a panel of 789
French customers recording purchases over a year within a traditional food product category. The polar-
Keywords:
isation index u (phi) was used as a measure of loyalty. The findings show that in comparison with other
Designation of origin labels
Quality assurance labels
extrinsic product attributes, DOLs constitute less important drivers of loyalty. However, brands carrying a
Loyalty DOL in comparison to brands that do not carry any DOL label exhibit higher levels of loyalty. The findings
Polarisation provide useful directions for the implementation of marketing strategies and management of product
Scanner data portfolios of product categories in which the marketing mix is often built on product attributes other than
the brand name.
Ó 2012 Elsevier Ltd. All rights reserved.

1. Introduction Loyalty to brands is more important in sectors where well

Companies often make considerable efforts to retain their cus-
tomers and establish a long-term relationship by purchasing their
offerings repeatedly. The main reason behind this decision is that a
firm’s economic success depends on the ability of maintaining its
customers who repeatedly purchase their offerings (Rust, Lemon,
& Zeithaml, 2004). Repeat purchase behaviour reflects to the
behavioural dimension of customer loyalty (Dick & Basu, 1994),
which is a concept that has been widely studied in the area of
marketing.
Loyalty has traditionally been studied at the brand name level
(i.e. brand loyalty). However, apart from the brand name, a brand
comprises a set of attributes (e.g. price, type of packaging, quality
claims) that consumers may use as heuristics that influence their
choices beyond the brand name per se. In certain cases, product
attributes may drive repeat loyalty stronger than the brand name.
Empirical evidence supports such hypothesis (e.g. Jarvis, Rungie,
Goodman, & Lockshin, 2006; Jarvis, Rungie, & Lockshin, 2007a,
2007b; Krystallis & Chrysochou, 2010, 2011; Singh, Ehrenberg, &
Goodhardt, 2008).
⇑ Corresponding author. Address: Haslegaardsvej 10, 8210, Aarhus V, Denmark.
Tel.: +45 871 6489.
E-mail address: polyc@asb.dk (P. Chrysochou).
established brands exist. In the case of fragmented markets, in
which a proliferation of small and not well-known brands exists,
brands do not solely compete on the basis of their names. In such
markets, product communication on the basis of product attributes
is essential. An example of a fragmented market is the wine mar-
ket, which is globally characterised by many small brands. In wine,
brand names do not constitute important cues to simplify con-
sumer choice (at least for the ‘‘average’’ consumer). Consumers
aiming to simplify their choice may use product attributes (e.g.
country of origin, price, quality label), which can drive loyalty on
wine more than the brand name. For example, Jarvis et al.
(2007b) investigate Australian consumers’ loyalty to wine attri-
butes such as brand, region, variety and price. Their findings sug-
gest that consumers exhibit higher loyalty toward price and
variety in comparison to region and brand. Such findings further
stress the importance of product attributes in comparison to brand
names. Therefore, in such markets, strategies should emphasise on
promoting product attributes (at least) together with building
strong brand names. Consequently, knowledge on which product
attributes perform better in terms of loyalty can be a source of
strategic advantage for managers.
This paper investigates the role of quality assurance labels as
product attributes that drive loyalty in the case of traditional food
products (TFPs). TFPs are exemplary differentiated products form-
ing a particularly fragmented market, characterised by many small

0950-3293/$ - see front matter Ó 2012 Elsevier Ltd. All rights reserved.
doi:10.1016/j.foodqual.2012.02.013
 P. Chrysochou et al. / Food Quality and Preference 25 (2012) 156–162
brands produced by relatively small firms. In Europe TFPs are very
common, whereas the European Union has introduced quality
assurance schemes known as Designation of Origin Labels (DOLs;
e.g. Protected Designation of Origin – PDO, or Protected Geograph-
ical Indication – PGI; Commission of the European Communities,
1992).Such an intervention aims to regulate the market of TFPs
and it gives a competitive marketing advantage to the SMEs in-
volved in the supply chain (in lack of SMEs’ ability to build strong
branded products). However, it is not yet known whether DOLs
accomplish their strategic mission, namely to assist producers of
TFPs in finding a market for their products. This paper therefore ad-
dresses the following research question: Do DOLs contribute in
making consumers purchase repeatedly brands of TFPs that carry
such labels?
Answering the above question is relevant both from a manage-
rial and a public policy perspective. Managers and producers of
TFPs and those who operate in fragmented markets in general
and are eager to invest in quality assurance labelling schemes need
to know to which extent such schemesact as additional drivers of
loyalty. From a public policy perspective, there is a need to know
whether consumers respond to policy interventions of this type
and, consequently, the extent to which such interventions affect
their overall buying behaviour. Finally, from a theoretical perspec-
tive, answering the above-described question using empirical evi-
dence generated from revealed preference (i.e. panel) data
provides further support to the importance of product attributes,
such as extrinsic quality cues (e.g. DOLs),as heuristic drivers of loy-
alty beyond the brand name.
1.1. Traditional food products in Europe
TFPs are very common in Europe. Within the European Union
there has been an increased interest in supporting and further pro-
moting TFPs, with regulations introducing quality assurance labels,
such as DOLs. Since these regulations took force in the early 1990s,
about 3000 DOLs for wines, spirits and agricultural products and
foodstuffs have been registered or are under examination (Euro-
pean Commission., 2008). Apart from differentiating TFPs from
conventional food products, DOLs aim to safeguard the survival
of those producing TFPs by protecting their products from imita-
tors and providing them a considerable competitive advantage
(Winfree & McCluskey, 2005). Moreover, from a consumer perspec-
tive DOLs contribute to increasing awareness, as well as ensuring
authenticity and strengthening the quality perception of TFPs
(Ilbery, Morris, Buller, Maye, & Kneafsey, 2005), often leading to
certain measurable outcomes of consumer purchasing behaviour,
such as increased willingness to pay for DOL-certified products
(Fotopoulos & Krystallis, 2003; van Ittersum, Meulenberg, Van
Trijp, & Candel, 2007).
There is a large body of literature on TFPs focusing on measur-
ing consumers’ attitudinal responses towards quality assurance la-
bels, with emphasis on DOLs. The main findings suggest that DOLs
influence consumer preferences for TFPs (Dimara & Skuras, 2003;
Ilbery, Kneafsey, & Bamford, 2000; van Ittersum, Candel, & Meulen-
berg, 2003). However, results have often been mixed, with other
studies suggesting DOLs not to have any direct effect on consumer
preferences (van der Lans, van Ittersum, De Cicco, & Loseby, 2001).
In relation to loyalty towards TFPs, there are only few studies that
aim to investigate this issue (Espejel, Fandos, & Flavián, 2007,
2008; Fandos & Flavián, 2006). The focus of these studies has pri-
marily been based on investigating differences between extrinsic
product attributes (e.g. origin and product labelling) and intrinsic
ones (e.g. flavour and other organoleptic characteristics). The main
findings suggest that extrinsic product attributes are more impor-
tant drivers of consumers’ loyalty (Fandos & Flavián, 2006), while
intrinsic product attributes have an effect only in newly launched
157
TFPs (Espejel et al., 2007). These results further prove the relevance
of investigating extrinsic product attributes as drivers of loyalty to
TFPs.
All the above studies are based on stated preference data (i.e.
data obtained through questionnaire-based surveys). Nevertheless,
little is known about consumers’ actual behavioural response to-
wards quality assurance labels. Therefore, it is important to explore
the role of DOLs on consumers’ repeat purchasing behaviour fur-
ther with revealed preference data (i.e. point-of-purchase data).
The present paper aims to investigate whether quality assurance
labels, such as the DOLs, perform as better drivers of loyalty in
comparison to other brand-related attributes, such as brand type
and price that are mainly said to influence consumers’ buying
behaviour (e.g. van der Lans et al., 2001). In addition, the paper
aims to investigate whether brands carrying a DOL achieve greater
levels of loyalty than brands that do not carry any label.
1.2. Loyalty from a repeat purchase perspective
Amongst the models used for empirically studying loyalty from
a repeat purchase perspective is the Dirichlet Multinomial Distri-
bution (DMD – Bhattacharya, 1997; Fader & Schmittlein, 1993).
The DMD belongs to the group of models that are often called
zero-order, due to their assumption that each purchase is unre-
lated to the previous one (‘‘as if random’’). The value of DMD as a
model to investigate loyaltystems from its ability to accommodate
useful benchmarks that have been widely tested and supported in
marketing, and observed for over 30 years in a large number of
product categories and across different countries (Ehrenberg, Un-
cles, & Goodhardt, 2004; Sharp, 2010; Uncles, Ehrenberg, & Ham-
mond, 1995). One of these benchmarks is the ‘‘double jeopardy’’
phenomenon that explains the tendency of small brands (i.e. those
with small market shares) to have lower repeat purchase probabil-
ities (Ehrenberg & Goodhardt, 1970; McPhee, 1963). This suggests
that loyalty, as an outcome of repeat purchase behaviour, is related
to a brand’s size and not to any specific characteristics related to its
positioning (Jarvis et al., 2007b).
Apart from providing useful benchmarks, the DMD model offers
measures at the product category level (Ehrenberg et al., 2004;
Goodhardt, Ehrenberg, & Chatfield, 1984). Reducing the multino-
mial calculations of the DMD down to a binomial model, such as
the Beta Binomial Distribution (BBD), can provide measures at
the individual brand level (Jarvis et al., 2007a, 2007b). In this re-
spect, the category DMD estimates offer a baseline that, in compar-
ison to the BBD estimates, can infer reinforcing or variety seeking
behaviour for different brands within a category as a source of loy-
alty (Jarvis & Goodman, 2005; Jarvis et al., 2007b). ‘‘Reinforcing’’
refers to the effect caused by big brands (i.e. those with a big mar-
ket share) showing higher levels of loyalty (Fader & Schmittlein,
1993). On the other hand, when brands exhibit lower levels of loy-
alty than their brand size would predict, these are then character-
ised as ‘‘change-of-pace’’, which is the outcome of a variety seeking
behaviour (Kahn, Kalwani, & Morrison, 1986). Finally, brands that
exhibit excess loyalty and have a small market share are character-
ised as ‘‘niche’’. However, it is very rare for small brands to achieve
a niche positioning. Empirical research from Fader and Schmitt-
lein(1993) covering many categories of consumer packaged goods
shows little evidence of niche positioning.
Jarvis, Rungie and Lockshin (2007a) argue that utilising the BBD
to accommodate attributes other than the brand name has the po-
tential for better understanding loyalty to product attributes be-
yond the brand name. In fact, based on this approach the authors
analyse loyalty to product attributes in the case of wine, and they
find evidence of attributes exhibiting reinforcing, niche and
change-of-pace characteristics. This paper follows a similar ap-
proach and addresses the aims of the study in order to explore
158 P. Chrysochou et al. / Food Quality and Preference 25 (2012) 156–162
which product attributes in the case of TFPs show change of pace,
reinforcing and niche characteristics, with a particular focus on the
impact of the DOL attribute.
1.3. Polarisation as a measure of loyalty
Polarisation u (phi) is used in this paper as a measure of loyalty.
Polarisation was initially proposed by Sabavala and Morrison
(1977) and utilised by other researchers (Fader & Schmittlein,
1993; Kalwani, 1980). Polarisation captures changes in heteroge-
neity of consumer choice as purchase incidence also changes.
Polarisation has many advantages against other brand perfor-
mance measures. Given that bigger brands have more buyers
who exhibit slightly higher repeat purchase rates than that for
smaller brands (Fader & Schmittlein, 1993), standard brand perfor-
mance measures, such as penetration and purchase frequency,
incorporate this bias that needs to be taken into account. On the
other hand, polarisation by standardising the repeat purchase rate
removes the effect of brand size and, therefore, is unrelated to it.
Another advantage of polarisation is that it is easy to interpret, gi-
ven that its value ranges from zero to one. Values of polarisation
close to zero signify pure homogeneity in consumer choice and,
therefore, indicate high switching levels among brands within a
product category. Values of polarisation close to one signify the
existence of maximum heterogeneity and, therefore, indicate high
levels of loyalty within a product category (Fader & Schmittlein,
1993; Stern & Hammond, 2004).
Polarisation has traditionally been utilised at the brand level
(Fader & Schmittlein, 1993; Kahn et al., 1986).However, recent
applications extend its use to account for loyalty at the product
attribute level (Jarvis et al., 2006; Jarvis et al., 2007a, 2007b;
Krystallis & Chrysochou, 2010, 2011). Jarvis et al. (2007a) compare
the polarisation derived from DMD measuring loyalty at the attri-
bute level, to the polarisation derived from BBD measuring loyalty
at the level of each attribute. This approach offers a conceptual
categorisation that identifies the levels of each attribute as
‘‘reinforcing’’, ‘‘niche’’ or ‘‘change-of-pace’’,as described above.
Fig. 1 illustrates this categorisation. Brands or levels of attributes
with BBD polarisation values that fall above the DMD polarisation
value, which is the average polarisation of the category or the attri-
bute, can be considered as ‘‘reinforcing’’ or ‘‘niche’’, depending on
the their size. Anything below this value can be considered
‘‘change-of-pace’’ brands or attribute levels.
Fig. 1. Schematic representation of reinforcing, niche and change-of-pace charac-
teristics (Adopted from Jarvis et al., 2007a).
2. Materials and method
2.1. Data and analysis
Data derive from a panel of 789 consumers who were loyalty
card holders of a single retail chain in France. Purchases of ten
brands of the dry-cured ham category available on the self-service
shelves of the supermarkets of the specific chain were recorded for
a period of one year. The study period is considered appropriate,
reflecting the usual time span used in similar studies (Jarvis
et al., 2007b). The total number of units bought was 4674, with
an average purchase rate of 6.0 units and an average annual trans-
action of €21.4 per shopper.
Each brand was categorised according to three different attri-
butes: brand type (‘‘Private label’’; ‘‘Commercial’’; ‘‘No frills’’), qual-
ity assurance label (‘‘DOL’’; ‘‘No DOL’’), and price tier (‘‘High’’;
‘‘Medium’’; ‘‘Low’’). ‘‘Commercial’’ were private firm brands and
‘‘Private label’’ were brands owned by the distributor. ‘‘No frills’’
brands are those positioned as ‘‘best price’’ offers by the retailer,
and thus they were considered as a separate level of brand type.
‘‘DOL’’ were those brands which had a Designation of Origin Label,
whereas ‘‘No DOL’’ did not have any such label. For the specific
product category, the DOL label was a Protected Geographical Indi-
cation (PGI). Prior to categorising each brand on price tiers, the
price of each pack is standardised based on the number of slices
and total weight. Based on the standardised price, ‘‘High’’ price
brands were those with a price above €3.28, ‘‘Medium’’ price
brands were those priced between €2.48 and €3.28 and ‘‘Low’’ price
brands were those priced below €2.48. The price tiers were created
after consultation with a product manager from the retail chain
that the data were derived from. The detailed categorisation of
each brand is presented in Table 1.
Certain brand performance measures (purchase rate and pene-
tration, both at the attribute and brand level) were estimated from
the raw data and were used as input to fit the DMD and BBD mod-
els. In the case of attribute-based sub-categories, the data were
first aggregated for each level, and then the same measures were
estimated accordingly prior to fitting the models. All model esti-
mations were conducted with the ‘‘DIRICHLET’’ software (Kearns,
2000).
3. Results
Fig. 2 depicts the BBD polarisation estimates, together with the
respective market share for each brand of dry-cured ham. The DMD
polarisation estimate is also presented (u = 0.30), which helps us
understand which brands perform better in terms of loyalty.
Ham_7 can be considered as a niche brand given that it has a mar-
ket share of 7.0% and the BBD polarisation estimate is 0.55. Ham_5
can be considered as a change-of-pace brand given that it has a
market share of 9.5 and the BBD polarisation estimate is 0.22.
Regarding the rest of the brands, the BBD polarisation estimates
are close to the DMD polarisation estimate, thus they can be con-
sidered as ‘‘normal’’.
Table 2 presents the results from the polarisation estimates for
each attribute and attribute level. Polarisation estimates from the
DMD explain which attributes are the most important drivers of
loyalty. Polarisation estimates for brand type is higher (u = 0.41)
followed by price tiers (u = 0.39) and quality assurance label
(u = 0.24).
Within brand type, ‘‘Private label’’ and ‘‘Commercial’’ have a
high market share and a polarisation estimate similar to that of
the category, whereas ‘‘No frills’’ has a very low market share
and a polarisation estimate that is lower than that of the category.
Within quality assurance label, ‘‘No DOL’’ has a high market share
 P. Chrysochou et al. / Food Quality and Preference 25 (2012) 156–162 159

Table 1
Product categorisation and observed performance measures.

Products Brand type Quality assurance label Price tier Market share (%) Penetration (%) Purchase frequency
1 Ham_2 Private label No DOL Medium 22.9 54.8 2.5
2 Ham_3 Private label DOL High 18.7 44.5 2.5
3 Ham_4 Commercial No DOL High 12.3 31.2 2.4
4 Ham_6 Private label No DOL Medium 11.0 28.9 2.3
5 Ham_5 Commercial No DOL High 9.5 29.3 2.0
6 Ham_8 Commercial No DOL High 7.4 20.4 2.2
7 Ham_7 Private label No DOL Medium 7.0 14.4 3.0
8 Ham_1 No frills No DOL Low 6.0 16.8 2.1
9 Ham_9 Commercial DOL High 3.7 11.7 2.0
10 Ham_10 Private label No DOL High 1.5 4.9 1.9

Fig. 2. DMD and BBD polarisation u vs. market share for all brands.

Table 2
Dirichlet Multinomial Distribution (attribute) and Beta Binomial Distribution (attri-
that is lower than that of the category. Fig. 3 depicts this relation-
bute level) polarisation u vs. market share. ship between market share, BBD and DMD polarisation estimates
and allows us to understand the position of each attribute level,
u Market share
as described in Fig. 1.
All Brands 0.30
Brand type 0.41
Private label 0.41 0.61 4. Discussion
Commercial 0.43 0.33
No frills 0.32 0.06
This paper aims to investigate the role of the existence of qual-
Price tier 0.39
High price 0.37 0.53 ity assurance labels as a product attribute that drives loyalty in the
Medium price 0.42 0.41 case of fragmented markets, using traditional food products (TFPs)
Low price 0.32 0.06 as a category of application. Panel data recording consumer pur-
Quality assurance label 0.24 chases within a TFP category (i.e. dry-cured ham) were analysed
No DOL 0.23 0.78
DOL 0.31 0.22
using a measure of loyalty, namely the polarisation index u. The
category under investigation shows a polarisation score of 0.30,
reflecting a moderate loyalty level. Previous studies report polari-
sation scores that range from 0.10 for product categories with
and a polarisation estimate that is close to that of the category, low loyalty levels (e.g. snacks and chocolate) to 0.60 for product
whereas ‘‘DOL’’ has a small market share and a polarisation esti- categories with high loyalty levels (e.g. milk and vegetable juice)
mate higher than that of the category. Finally, within price tiers, (Fader & Schmittlein, 1993).
‘‘High price’’ and ‘‘Medium price’’ have high market share and On the attribute-based level, brand type and price tiers show
polarisation estimates close to those of the category, whereas higher loyalty in comparison to quality assurance labels. This result
‘‘Low price’’ has a small market share and a polarisation estimate suggests that, for the category of dry-cured ham, quality assurance
160 P. Chrysochou et al. / Food Quality and Preference 25 (2012) 156–162
Fig. 3. DMD and BBD polarisation u vs. market share for all attributes.
labels do not constitute a more important driver of loyalty for con-
sumers in comparison to brand type and price tiers. There are two
possible explanations for this finding that call for further investiga-
tion. First, consumers are said to lack awareness and have limited
understanding of the DOL scheme (Fotopoulos & Krystallis, 2003;
van Ittersum et al., 2007), which may have resulted to consumers
showing less importance towards DOLs as a product attribute that
has the potential to affect their choices. Second, loyalty card hold-
ers are said to be inclined towards private label brands (Ailawadi,
Pauwels, & Steenkamp, 2008), and as a result loyalty towards the
‘‘brand type’’ attribute may have been overestimated.
The polarisation scores obtained for each attribute level, in
comparison to their respective market shares and the polarisation
scores of each attribute, further yield some interesting findings. In
relation to brand type, commercial and private labels have similar
loyalty, which is also similar to category loyalty; this does not lead
to safe conclusions as to whether commercial or private labels are
change-of-pace or reinforcing attribute levels. However, the ‘‘No
Frills’’ attribute level has low market share and low loyalty, sug-
gesting that promotion branding performs as a change-of-pace
characteristic of low importance.
In relation to the quality assurance label, brands that do not car-
ry any DOL have higher market share but less loyalty, suggesting
that ‘‘No DOL’’ is a change-of-pace attribute level. On the other
hand, brands carrying a DOL have lower market share but greater
loyalty, suggesting that DOL constitutes a niche attribute level. In
conclusion, quality assurance labels can act as reinforcing product
attributes, enhancing the overall loyalty exhibited towards a
brand. This result further confirms previous research in a rather
similar category of a TFP (air-cured ham) that found loyalty to be
influenced by extrinsic quality cues, such as DOLs (Espejel et al.,
2007).
Finally, in relation to price tiers, the ‘‘medium price’’ level has
greater loyalty in comparison to the ‘‘low price’’ level. Moreover,
the low price level has lower market share, something that is dif-
ferent from findings in other categories (Jarvis et al., 2006). This
difference is possibly the result of the formation of the levels of
price tiers in the present study. In fact, loyalty for the ‘‘medium
price’’ level is slightly higher than for the ‘‘high price’’ level, some-
thing that does not allow for safe conclusions. On the contrary, low
price acts as a change-of-pace attribute level of low importance, gi-
ven its smaller market share.
5. Conclusion and implications
Measuring loyalty to product attributes is important, since
manufacturers, retailers and marketers generally seem to have lit-
tle empirical knowledge on this issue (Singh et al., 2008). The ap-
proach of polarisation applied in this study allows the
examination of loyalty to product attributes. Such knowledge,
combined with the market size of each product attribute level, pro-
vides useful directions for the implementation of marketing strat-
egies and the management of product portfolios. In the case of
fragmented markets, such as the market of TFPs, understanding
which product attributes and attribute levels drive loyalty and sell
the most is essential, since the marketing mix is often based on
product attributes other than the brand name. In the case of TFPs,
DOLs constitute less important drivers of loyalty in comparison to
other extrinsic product attributes, such as price tiers and brand
type. However, in comparison to brands that do not carry any label,
brands carrying a DOL show greater levels of loyalty.
There are substantial implications stemming from this study.
From a managerial perspective, results illustrate directions for
implementation of marketing strategies based on product attri-
butes that induce loyalty, such as in the case of TFPs and other frag-
mented markets. As a result, levels of attributes that show greater
loyalty require reinforcing strategies, such as strong branding and
heavy advertising. In contrast, levels of attributes showing change-
of-pace characteristics require variety seeking strategies, such as
sales promotion and featuring. In the case of TFPs, variety seeking
strategies based on the existence of a DOL should be avoided. Such
strategies may only skim variety seeking customers who will
switch back to other brands. Nevertheless, managers should also
 P. Chrysochou et al. / Food Quality and Preference 25 (2012) 156–162
incorporate in their decision making the market size of an attri-
bute, which in the case of DOL is rather small. In this case, it could
be that such a strategy may not be profitable, given that the cus-
tomer base is small.
Moreover, managers responsible for the development of brand
portfolios are always eager in properly selecting levels of attri-
butes. For example, in the case of TFPs, the question remains about
whether managers should invest in building a brand that carries a
DOL, and, if yes, what price level would be more appropriate. How-
ever, the selection of attribute levels is by definition limited, and
choice in this respect should be based on whether an attribute le-
vel is able to yield a higher return on investment. Under such cir-
cumstances, a general rule could be to invest on attribute levels
that are able to generate greater loyalty. For instance, the results
from this study suggest that the ideal combination of attribute lev-
els that may generate greater loyalty is a product carrying a com-
mercial brand, a DOL, and an average price level.
Stemming from this study there are substantial implications.
From a managerial perspective, the study illustrates directions
for the implementation of marketing strategies based on product
attributes that induce loyalty, such as in the case of TFPs and other
fragmented markets. As a result, levels of attributes that show
greater loyalty require reinforcing strategies, such as strong brand-
ing and heavy advertising. In contrast, levels of attributes showing
change-of-pace characteristics require variety seeking strategies,
such as sales promotion and featuring. In the case of TFPs, variety
seeking strategies based on the DOL should be avoided. Such strat-
egies may only skim variety seeking customers who will switch
back again to other brands. Nevertheless, one should keep in mind
the market size of the attribute, which in the case of DOL is rather
small. In this case, it could be that such a strategy may not be prof-
itable, given that the consumer base will be small.
Moreover, managers responsible for the development of brand
portfolios are always eager in properly selecting levels of attri-
butes. For example, in the case of TFPs, the question remains about
whether managers should invest in building a brand that carries a
DOL, and, if yes, what price level wouldbe more appropriate. How-
ever, the selection of attribute levels is limited by definition and
the choice should be based on whether an attribute level is able
to yield a higher return on investment. Under such circumstances,
a general rule could be to invest on attribute levels that are able to
generate greater loyalty. For instance, the results from this study
would suggest that the ideal combination of attribute levels that
may generate greater loyalty is a commercial brand, carrying a
DOL, sold at an average price level.
This study supports that DOLs act as reinforcing attributes, con-
tributing towards creating a niche positioning for TFP brands. By
definition, TFPs are produced within a specific geographical area,
often with limited production capabilities and, therefore, their
market share cannot increase substantially. Appropriate marketing
strategies thus need to be deployed so that products establish a
loyal consumer base and achieve better price levels. From a public
policy perspective, the introduction of quality assurance labels has
been successful in this respect, since it helped producers to estab-
lish a niche position in the market of TFPs.
From a theoretical perspective, this study further contributes to
the understanding of the role of market share as the sole explana-
tory measure of loyalty to product attributes (Fader & Schmittlein,
1993; Jarvis et al., 2007b). The results show that large-share attri-
bute levels show excess loyalty, actually due to their greater mar-
ket share. This was the case for brand type and price tiers, even
though there were levels of attributes with lower market share
that showed slightly greater loyalty. However, the existence of
quality assurance labels showed a deviation from this norm, with
DOL acting as a reinforcing attribute level. This suggests that there
are different types of product attributes that display diverse
161
dynamics in the positioning of brands. On the one hand, there
are ‘‘global’’ attributes that constitute basic determinants of choice
across product categories (e.g. price, pack size), and for these it is
difficult to obtain a niche positioning. In this respect, small brands
should avoid small levels of such attributes, as this may constitute
a reason to be small. On the other hand, in the realities of more ‘‘lo-
cal/national’’ market settings there are attributes that can charac-
terise the category and act as unique determinants of choice (e.g.
quality assurance labels, organic, functional foods), and can allow
niche positioning. However, such an argument requires further
empirical support, leading to suggestion for future research.
This study also has limitations that point to additional proposi-
tions for future research. First, although the quest for panel data is
a difficult task, additional product categories should be included in
order to be able to generalise these findings or find preconditions
under which quality assurance labels work as better drivers of loy-
alty. Research on more categories of TFPs is also required to further
generalise the present findings. Second, an approach of this type
may be influenced by the selection of attributes and the set-up
of attribute levels. Even though the nature of the data limits the
choice of attributes, other product attributes may also be impor-
tant determinants of consumer choice towards TFPs. For example,
intrinsic quality cues evaluated in a pre-purchase condition (i.e. vi-
sual quality) have been suggested to influence consumer percep-
tions about quality (Krystallis, Chryssochoidis, & Scholderer,
2007) and loyalty (Espejel et al., 2007). Finally, the approach of
polarisation dealt with each attribute separately, without taking
into account interaction effects. However, attribute independence
in influencing consumer attitudes and behaviour is far from reality,
since products offer a combination of attributes, and consumers
base their decision on evaluating competing attribute sets rather
than isolated individual attributes. Models that incorporate inter-
action effects for product attribute levels, such as the Qualitative
Multinomial Distribution (Corsi & Rungie, 2010), could add value
to the existing research.
Acknowledgements
This study was carried out in the framework of the European
RTD project TYPIC ‘‘Typical Food Products in Europe: Consumer
Preference and Objective Assessment’’ (QLK1-CT-2002-02,225 –
www.typic.org) funded by the European Commission DG Research.
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