Is loyalty driving growth for the brand in front? A two-purchase analysis of car category dynamics in Thailand

Abstract

Marketers are often exhorted to grow brand share through increased loyalty. To investigate this proposition, we report on an extension of the two-purchase analysis technique to a dynamic category of infrequently bought goods, new cars in Thailand. This analysis captures market structure quite well, and reveals that brand-share growth comes not from unusually high loyalty but from first time customers attracted to large brands in line with the duplication of purchase law.

Keywords:

• two-purchase analysis
• Double Jeopardy
• Dirichlet

Acknowledgements

The authors would like to thank Bawornphan Phaisarnsirintkoon for his invaluable help in compiling the sampling frame and collecting the data used in this research.