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The Demand for Pork Products in Canada: Discount Promotions and Cannibalization

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  • Getu Hailu
  • Richard J. Vyn
  • Yong Ma

Abstract

ABSTRACT We estimate the effectiveness of offering discounts on the demand for featured pork products using Ipsos‐Reid's Consumer Panel of Canada data for a 1‐year period from April 2007 to March 2008, and explore whether there are any positive or negative spillover effects on non‐featured products because of these discounts. We find strong evidence that, as expected, discounts increase the purchases of the featured products. However, we find that offering discounts may have cannibalistic effects – negative cross‐discount effects – on non‐featured products, and that these effects vary considerably among pork products. From the retailers’ perspective, as profit margins have become smaller, our results indicate the need to develop a promotion strategy that minimizes the cannibalistic effects from discounts.

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  • Getu Hailu & Richard J. Vyn & Yong Ma, 2014. "The Demand for Pork Products in Canada: Discount Promotions and Cannibalization," Agribusiness, John Wiley & Sons, Ltd., vol. 30(4), pages 470-492, September.
    • Handle: RePEc:wly:agribz:v:30:y:2014:i:4:p:470-492
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    File URL: http://hdl.handle.net/10.1002/agr.21383
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    Cited by:

    1. Lee, Hanbin & Sexton, Richard J. & Sumner, Daniel A., 2021. "Economics of Mandates on Farm Practices: Lessons from California’s Proposition 12 Regulations on Pork Sold in California," 2021 Annual Meeting, August 1-3, Austin, Texas 313920, Agricultural and Applied Economics Association.
    2. Jing Li & Edward C. Jaenicke & Tobenna D. Anekwe & Alessandro Bonanno, 2018. "Demand for ready‐to‐eat cereals with household‐level censored purchase data and nutrition label information: A distance metric approach," Agribusiness, John Wiley & Sons, Ltd., vol. 34(4), pages 687-713, October.
    3. Bo Chen & Wuyang Hu & Qingjie Zhou, 2020. "Effects of local and national advertising across brands: the case of yogurt in China," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 64(4), pages 1260-1281, October.
    4. Getu Hailu, 2021. "COVID‐19 and food processing in Canada," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 69(2), pages 177-187, June.
    5. Lee, Hanbin & Sexton, Richard J. & Sumner, Daniel A., 2022. "Government Restrictions on Food Available to Consumers: Economics of Regulations that Limit Farming Practices for Products Sold within Jurisdictions, with Application to California’s 2022 Pork Rules," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322438, Agricultural and Applied Economics Association.
    6. Hanbin Lee & Richard J. Sexton & Daniel A. Sumner, 2023. "National and subnational regulation of farm practices for consumer products sold within a jurisdiction: California's Proposition 12," Agricultural Economics, International Association of Agricultural Economists, vol. 54(6), pages 838-853, November.
    7. Richard J. Vyn & Getu Hailu, 2015. "Discount Usage and Price Discrimination for Pork Products in Canada," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 63(4), pages 449-474, December.

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