ERIC Number: EJ895486
Record Type: Journal
Publication Date: 2010-Sep
Abstractor: As Provided
Reference Count: 35
A Bayesian Multi-Level Factor Analytic Model of Consumer Price Sensitivities across Categories
Duvvuri, Sri Devi; Gruca, Thomas S.
Psychometrika, v75 n3 p558-578 Sep 2010
Identifying price sensitive consumers is an important problem in marketing. We develop a Bayesian multi-level factor analytic model of the covariation among household-level price sensitivities across product categories that are substitutes. Based on a multivariate probit model of category incidence, this framework also allows the researcher to model overall price sensitivity (i.e., indicated by higher-order factor scores) as a function of household-level covariates. All model parameters are estimated simultaneously to circumvent the downward bias resulting from two-stage estimation. The modeling framework is illustrated using scanner panel data from multiple categories of instant coffee.
Descriptors: Marketing, Costs, Consumer Economics, Models, Computation, Bayesian Statistics, Factor Analysis
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Publication Type: Journal Articles; Reports - Evaluative
Education Level: N/A
Authoring Institution: N/A