The Impact of Promotions on Consumer Purchasing Behaviour in the Red Meat Sector

The original contribution of this thesis to research is the in-depth analysis of promotions using a database which is unique both in terms of its scale and application. The overall aim of the research was to investigate the impact of promotions within the red meat sector in order to generate a better understanding of which promotions work most effectively. It is hoped that as a result of this research, the industry will be in a better position to influence retailers to implement promotions which will be most beneficial for the retailers, producers and consumers. Currently British livestock farmers are finding it increasingly difficult to make a sustainable living from farming as a result of increased pressure from imports, often resulting in the excessive use of price promotions in an increasingly desperate effort to defend British meat against cheaper imports.

Quantitative research was undertaken, through regression analysis, to identify the effects of promotions on sales value, within the beef sector primarily. The analysis used loyalty card purchasing data from dunnhumby, which comprises o f purchasing information from a panel of 14 million supermarket shoppers in the UK. The analysis drills down into the beef category to look specifically at the effects of promotions at the product sub-group level, as well as identifying cross-species and cross-tier substitution effects.

The findings revealed significant differences in the ways shoppers respond to different promotions, depending upon characteristics specific to the product, for example based upon the meal occasion it is used for, and the tier of the product, for example whether it is a standard or premium product. One of the key recommendations is that promotions need to be focused more on premium, differentiated products rather than standard lines, since these add more value to the red meat category. This will benefit the British meat industry in the long term, since it entices shoppers away from cheaper, often imported, products, and it encourages British producers to become more competitive by adding value through differentiating their products.