Micro-Marketing Using Supermarket Scanner Data
Micro-marketing refers to the customization of marketing mix variables to the store level. We show how prices could be customized to the store level, rather than adopting a uniform marketing policy across all stores. A basis for these customized pricing strategies is a result of differences in interbrand competition across stores. These changes in inter-brand competition are related to demographic and competitive characteristics of the store’s trading area. This study finds that profitable micromarketing pricing strategies can be implemented. These pricing strategies can increase expected operating profits by 25%.