Linking Online Niche Sales to Offline Brand Conditions

Abstract

With the dramatic growth in the online marketplace, online retailers are keen to understand and leverage the interplay between offline environment and online sales. This study examinesthe influence of offline brand conditions on online sales of niche brands. Specifically, we investigate the proximity to the leading brand’s headquarters, city of origin, and the extent of its offline distribution, offline brand availability.We also examine the moderating effect of offline affinity for niche attributes, offline niche affinity. Using sales data of niche brands, we find that brand share is higher in regions closer to the city of origin and where brand availability is limited. The category sales benefit from proximity to the city of origin and increased offline brand availability. This positive impact of favorable offline brand conditions on category sales is more prominent in regions with lower niche affinity. Finally we offer managerial insights for marketing practice