Assessing the Effects of Assortment and Ambience: A Choice Experimental Approach KITTY KOELEMEIJER Nyenrode University HARMEN OPPEWAL University of Sydney Elaborating on Betancourt and Gautchi, we formulate and test effects of consumption goal, retail assortment composition, and other distribution services on in-store purchase deci- sions. By using the extended logit model we explain the utility of an item as a function of assortment characteristics, which allows capturing substitution, complementarity and asymmetric dominance effects. A choice experiment manipulates assortment composition, prices, store ambience, competing store features, and purchase goal. In an application to florist stores we find that in-store purchase decisions are affected by the size and composition of the assortment, and by the presence of a competing store, but not by ambience. We find substitution effects between flowers of the same variety, but not for all varieties. Effects differ between consumption goals. Assortment composition is a key issue faced by retail store and category managers. Given limited shelf space, which items should be added to or deleted from the assortment? How will these and competitors’ assortment decisions affect total and individual item sales? Management of assortments requires knowledge of substitution and complementarity patterns among items in the assortment, as well as the effect of offerings from competing stores. It also requires knowledge of the effects of other distribution services, such as store ambience and accessibility, on these inter-item relationships. Though a large literature exists on shopping models and consumer choice processes, only a few articles apply to the issue of assortment composition and its effects on consumer choice of assortment. Merchandise assortment has been consistently present as one of the dimensions that constitute store image (see Mazurski and Jacoby 1986). Also, models of consumer choice of shopping destination always seem to include a predictor like choice range, selection, quality of the assortment and the like (see Oppewal, Louviere, Kitty Koelemeijer is a research fellow at the Centre for Supply Chain Management of Nyenrode University, Breukelen, The Netherlands. Harmen Oppewal is a senior lecturer at the Department of Marketing of The University of Sydney, Sydney, Australia and an assistant professor at the Urban Planning Group of the Eindhoven University of Technology, The Netherlands. Journal of Retailing, Volume 75(3) pp. 319 –345, ISSN: 0022-4359 Copyright © 1999 by New York University. All rights of reproduction in any form reserved. 319