earticle

영어

As franchise systems expand, the proximity of same-brand outlets raises concerns about whether it fosters intrabrand competition or increase market size, both online and offline. Prior studies have examined these effects separately, often overlooking how they vary across channels. Understanding the simultaneous impact of proximity on online and offline markets is crucial for evaluating cannibalization and competition dynamics. This study investigates the differing impacts of spatial proximity between same-brand stores on online and offline performance. We examine this by utilizing the channel (i.e., offline and online) sales data from a South Korean retailing company, we find evidence of agglomeration effects in the offline channel, where intrabrand clustering leads to increased sales by expanding the market size. However, in the online channel, competitive effects dominate, as greater proximity between stores is associated with a decrease in online sales. These findings highlight the contrasting dynamics of store clustering across channels and offer insights for optimizing multi-channel retail strategies.