A study of market structure: Brand loyalty and brand switching behaviours for durable household appliances

The main purpose of this paper is to provide an approach for analysing market structure in terms of brand loyalty and brand switching behaviours for the purchase of durable household appliances. A three-choice model provided by McCarthy et al. (1992) is implemented as the main technique in our approach. First, we segment the market by measuring the proportion of brand loyal customers and brand switchers using this three-choice model. Then we employ factor analysis and ANOVA in order to identify the key factors affecting brand loyalty and to understand whether or not differences exist among the factors deemed important by heterogeneous customer segments. Through the application of empirical data, collected on the refrigerator market data in Taiwan, it can be seen that it is helpful to understand the structure and brand switching behaviours of a specific product line.