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Consumer Response Analysis to Package Downsizing Strategy

Student: Bokova Elena

Supervisor: Marina V. Sheina

Faculty: Faculty of Economics, Management, and Business Informatics

Educational Programme: Economics (Bachelor)

Year of Graduation: 2020

The study examines the problem of deceptive packaging and slack-filling on the fast-moving consumer goods (FMCG) market in Russia. The purpose of this research is to investigate to what extent consumers are informed about existing package downsizing. Furthermore, we aim to estimate the short-term and long-term impact on the sales of a product with lowered volume or weight. Although those issues have been discussed in terms of possible psychological reactions, the research focus of this paper is shifted towards modelling financial results of different marketing strategies. There is no established research methodology to evaluate possible effects from package downsizing on sales of the product in question. I adopted an ordinary least squares (OLS) method to describe consumers' reaction to this marketing practice through estimating several parameters in the linear regression model. The dataset includes five-year pre-packaged juice sales from a local retailer to obtained to determine how downsizing of that product can affect its sales. Achieved results showed that there is a statistically significant negative reciprocity between the downsizing variable and retailer’s total revenue. The study enhanced previous knowledge on the package downsizing effectiveness and can be used in the sphere of product marketing. In future it seems appropriate to conduct similar studies for different product markets or employ this method to derive possible country effects.

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