Determinants of a Demand for Differentiated Goods. The Estimation of the Influence of Product Characteristics on Choosing a Chocolate Bar

Nowadays, the evaluation of the demand for differentiated goods is becoming an increasingly popular topic in economic studies devoted to the market analysis, because of growing volumes of information and the emergence of the opportunity to collect large amounts of data on consumers. Despite all the variety of such studies, the market for chocolate bars is not paid much attention, although its volume in monetary terms is more than $ 100 billion. In real life, individuals do not face continuous quantities making consumer choice, as it does in theory, which makes it attractive to study discrete choice models that allow us to weaken the assumption of the indivisibility of goods and bring the same theory closer to economic reality. In this work, we are engaged in the construction of a conditional logit model for the chocolate bars market, and evaluate the influence of various chocolate product characteristics. We found out that the weight of the bar, the sugar content and the calorie content positively influence the probability of buying a chocolate, while the price and the ratio of the content of cocoa to the milk content is negative. In addition, it turned out that the presence of nougat increases the chances of choosing such a bar in comparison with other fillings, while caramel and nuts do not have such influence. The insights obtained can be useful both for manufacturing companies and for food retailers. In conclusion, we also consider several areas for further research on the chocolate market, as well as options for improving this work.