“Managing Store-Within-A-Store Relationships: Understanding the Effects of External Social Comparison” by Professor David A. Griffith
STRATEGY AND IB SEMINAR
Professor David A. Griffith
Professor of Marketing
Department of Marketing
College of Business and Economics
The store-within-a-store (SWS) format poses significant retail management challenges. Specifically, information exchange among co-located brand manufacturers heightens comparisons among these brand manufacturers, which, due to negativity and self-serving biases, increases perceptions of unfairness. We contend that unfairness perceptions can be reduced by the retailer through developing strong ties with the brand manufacturer and proactively explaining the rationale for a retailer’s action. We test our hypotheses via a two-study, multi-method design, including a matched dyadic survey of retail and brand manufacturers in a South Korean SWS retailer and an experiment conducted with SWS brand manufacturers in a Japanese retailer. The findings indicate that information exchange among brand manufacturers and discrepancy in referent brands between the retailer and a focal brand manufacturer increase perceptions of unfairness. Further, we find that perceptions of unfairness are lower when there is a strong tie between the retailer and a focal brand manufacturer. More of note, unfairness perceptions can be managed by the retailer proactively explaining the rationale for the action to the focal brand manufacturer and working to re-anchor the brand manufacturer on an appropriate comparative referent.