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Brand Switch Analyst – Strategic Marketing |
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Brand Switch Analyst fosters strategic thinking in managers interested in analyzing brand switch behavior, which is the tendency of consumers to change preference between products offering comparable benefits.
The market share of a firm is seen as a major means of determining its competitive position. Professor Kotler said, "Marketing executives must watch their market shares just as much as their profits. Present customers can never be taken for granted." Although written in 1963, this statement is still of great relevance, and in part has inspired the development of Brand Switch Analyst.
Three factors determine a company's market share structure:
- The management's ability to retain present customers, also called Retention Rate or Brand Loyalty Index.
- The management's ability to draw customers away from competitors, that is the Switching-in Rate.
- The tendency for a brand to lose customers, that is the Switching-out Rate.
Brand Switch Analyst produces low-cost estimates of switch and retention rates, which otherwise would have to be estimated using expensive market research surveys. Our tool applies quadratic programming as described by Theil and Rey (see MM4XL help file).
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