Wednesday, April 22, 2009

The Geography of Brand Shares

More mappiness via Matt Yglesias. He links to a post by Andrew Gelman that has these maps:



The maps are pertinent to an article (pdf), which Yglesias also links to, which argues that brands which are first to enter a given market are likely to maintain an edge in that market, even more than a century after their first competition from other brands:
We document evidence of a persistent “early entry” advantage for brands in 34 consumer packaged goods industries across the 50 largest U.S. cities. Current market shares are higher in markets closest to a brand’s historic city of origin than in those farthest. For six industries, we know the order of entry among the top brands in each of the markets. We find an early entry effect on a brand’s current market share and perceived quality across U.S. cities. The magnitude of this effect typically drives the rank order of market shares and perceived quality levels across cities. [...] Across 49 current leading national CPG brands, dating back to the late 1800s and early 1900s, we find that the current share in markets close to the city of origin, is, on average, 12 share (i.e., percentage) points higher than the national average of 22 percent.
You'll note that Starbucks was started in Seattle, and Walmart was started in Arkansas.

The paper itself includes these maps:


The joint geographic distribution of share levels and early entry across US markets in ground coffee. The areas of the circles are proportional to share levels. Shaded circles indicate a brand locally moved first.
As you can see, Maxwell House is the Biggie Smalls to Folgers' Tupac, with each brand performing stronger near the area that they started out (Nashville for Maxwell House and San Francisco for Folgers). Other examples of this phenomenon include Miller beer, which was introduced in Chicago in 1856 and still has a disproportionate share of that city's beer market, and Heinz ketchup, which started out in Pittsburgh and still does better in that city than elsewhere.

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