Product eliminations

: consumer costs and the impact on satisfaction and loyalty

Abstract

Nowadays, consumers want to have a big wide variety of product offerings available and companies launch extended product lines and innovations to meet such demand. However, not every product turns out to be a top performer. In fact, 75% of consumer-packaged goods and retail products fail to reach $7.5 million in the first year on the market. These failed products can even decrease firm’s profitability and earnings, which justifies the implementation of product eliminations. Product Elimination is defined as the decision of a company to end the production and marketing of a product, and existing work suggests that it is a valuable tool to free resources that can be invested in other promising products. Nevertheless, companies need to be cautious and understand the impact this tool may have on consumer relationships. The main purpose of this dissertation is to study the impact of consumer costs derived from product elimination on satisfaction and loyalty towards the company responsible for the elimination. Primary and secondary data were collected from a conducted survey and by consulting existing literature on the proposed topics. In the end, it was proved that consumer costs of a product elimination negatively impact satisfaction and loyalty after the elimination. Moreover, satisfaction after elimination positively impacts loyalty and mediates the effect of consumer costs on loyalty.

Date of Award	22 May 2018
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Paulo Romeiro (Supervisor)