Market Shares of Stores:

The effect of marketing strategy variables on the market shares of shore is examined. Both manufacturers and retailers play equally important roles in the functioning of marketing channels. In spite of this, the impact of marketing strategy variables on the competitive performance of stores, rather than that of brands, has been far less commonly examined in the literature. A market share model is developed and then tested using state-of-the-art scanner data. The results show statistically significant differences in the effects, on store share, of price and promotional variables between leader and follower brands. In addition, the market share models are able to predict store market shares with a high degree of accuracy in a hold-out sample. The model is then expanded to include variables with respect to competitor brands and competitor stores and then tested. Various managerial implications of the differential effects of brand strategy are discussed.     

Decomposing the effect of advertising: What happens in the retail channel?

The diverging interests of manufacturers and retailers famously give rise to the double marginalization problem but have consequences far beyond pricing. Advertising is another marketing instrument that is under the control of the manufacturer but its ultimate effect on consumer demand also depends on retailers’ pricing decisions. We decompose the effect of advertising in the channel and highlight an additional route through which advertising affects sales, namely via the changes in the retail price that a strategic retailer makes in response to changes in demand following manufacturer advertising. The total demand effect of advertising thus comprises the direct effects of advertising on market shares, and the indirect effects coming through adjustments that the retailer makes to the in-store prices of all the brands in a given product category in response to the shifted demand due to advertising. We match advertising data for four different categories (both food and non-food) to store-level scanner panel data, which also include information on wholesale prices. Controlling for wholesale prices, we establish in a reduced-form model that the retailer reacts to manufacturer advertising by changing retail prices instead of simply imposing a constant markup on the wholesale price. To further explore the role of the strategic response of the retailer in a systematic fashion and quantify the effects derived in the decomposition, we estimate a discrete-choice model of demand and determine the magnitude of the direct and indirect effects. We find that the indirect effect of advertising through retailer prices is about half the size of the direct effect, and thus substantively affects advertising effectiveness.     

The relationship between in-store marketing and observed sales for organic versus fair trade products

To stimulate sales of sustainable products, such as organic and fair trade products, retailers need to know whether their in-store instruments effectively enhance market shares. This study uses sales data and a multilevel modeling approach to explain the market shares of sustainable products according to shelf layout factors, price level, price promotions, and consumer demographics. It argues that the effect of these variables differs between organic versus fair trade products, as buying motives might differ, organic buyers tend to be more loyal, and price is a more informative signal of quality for organic products. Results show that the number of facings has a positive relationship with the market share of fair trade brands, but not with the market share of organic brands. The same holds for the price difference with the leading brand, which is important for fair trade brands but not for organic brands. In contrast, an arrangement of the product category by brand is associated with higher market share for organic brands but not for fair trade brands. Additionally, placement at eye level and clustering of items benefits both types of sustainable brands, whereas they appear to be not very sensitive to price promotions. Finally, higher sales of sustainable products are found in areas where the customer base is older and has a higher education level.     

Promotional Strategies of Brand Leaders,Challengers, and Followers

Sales promotion tools are assuming increasingly im- portant roles in brand marketing strategies. A conceptual promotion model is proposed to capture the similarities and differences in the price and display based promotional practices and their effects on market shares for brand leaders. challengers and followers. Using a two stage econometric analysis, we observe a clear gradation in the effects of promotions on the market shares of these three categories of brands, respectively. The way in which price-promotion and dis- play decisions are coordinated is also found to be different for these three brand categories.     

Advertising and Economic Development

In this article it is argued that West Germany has developed into the largest advertising market with the highest productivity per employee in Western Europe. We observe a continuous increase of net advertising turnover during the 1970s. Some extraordinary characteristics of the German advertising market (such as the structure of the TV advertising market and the printed media industry), which set it into sharp contrast to other European advertising markets, are discussed. Furthermore, we analyse the relationship between advertising and the business cycle movement (procyclical v. anticyclical advertising strategies) and we find that the majority of German business firms still pursue a procyclical advertising strategy although evidence seems to prove that an anticyclical advertising policy adopted during recessions will result in higher market shares and strengthened market positions of advertised brands.     

Non-price determinants of automotive demand: Restyling matters most

This paper analyzes market share changes in automobile and light truck submarkets. We find that new product, as measured by restyling, represents the most consistent, dominant determinant of demand. On average a 10% reduction in relative price would yield only one-tenth the market share impact of a restyling. Alternatively, one would have to double one's relative advertising expenditures to match the impact of a restyling. Several demand determinants not previously modeled, including rebranding and warranty curtailments, were detrimental to domestic manufacturer market shares. Safety appliance adoptions and changes in vehicle reliability had minimal impact on demand.     

电视广告营销中的“全过程无忧虑服务”探析

电视媒体广告的全过程无忧虑服务营销策略,体现的是电视媒体经营人员的市场意识,对于电视广告营销面临的诸多困难,是一个可选择的改造之路。它帮助电视广告营销克服同质化,同时实现电视广告营销的专业化。     

Testing Retail Marketing-Mix Effects on Patronage: A Meta-Analysis

Retailers have always worked to establish close relationships with customers through the retail marketing mix. Thus, the literature has a long tradition of testing the effects of various instruments on retail patronage. This meta-study synthesizes prior research into one comprehensive framework. We use 14,895 effect sizes reported by more than 239,000 shoppers from 41 countries extracted from 350 independent samples, to test the impact of 24 marketing-mix instruments on retail patronage. Specifically, we investigate the direct and indirect effects of these instruments on store satisfaction, word of mouth, patronage intention, and behavior. Product and brand management related instruments display the strongest effects on most outcome variables, whereas price, communication, service and incentive management instruments affect only selected outcomes. Distribution management turns out to be of secondary importance. However, the effectiveness of these instruments depends on the specific shopping context (food/non-food, shopping frequency, single store/agglomeration, hedonic/utilitarian), the retail environment (gross domestic product, country innovativeness, retail sales share, retail employment, Internet era), and the employed method (participant type, study design, data source). Specifically, we reveal most differences for hedonic shopping environments and developed countries. Also, the store’s advertising and atmosphere have gained importance in the Internet era, while purchase incentives, in-store orientation, and store location have lost relevance. This study contributes to a synoptic understanding of the comparable effectiveness of retail marketing instruments on retail patronage. It offers insights into the effectiveness of marketing-mix instruments and provides guidance on whether and when to invest in them. It also presents an agenda for future research on marketing-mix instruments.     

Advertising effect on primary demand: a cointegration approach

This paper addresses the question of the effects of advertising on the primary demand for whisky in Italy. In contrast to previous works, this issue is investigated in a multivariate framework by referring to Johansen's cointegration technique; this choice allows the non-stationary dynamics of aggregate marketing data to be taken into account, as well as their short-term and long-term relationships. Even if advertising is linked to real prices and sales in the long run, our analysis reveals no evidence supporting the effectiveness of advertising on the aggregate demand for whisky, which is essentially determined by the real price, both in the short and the long term.     

SIMS: a Store Image Monitoring System

During the last decade the UK grocery trade has become increasingly competitive as national chains have fought for an increase in market share in a relatively static market place. Retailers have become more aggressive in their marketing strategies and tactics, one noticeable trend being a significant increase in promotion and advertising expenditure. To date, however, few studies have tackled the difficult question of evaluating the effectiveness of their advertising. The authors propose a system for continuous monitoring of the effects of advertising on retail store image using multidimensional scaling techniques, and demonstrate the system on a small-scale study of supermarket advertising.     

Marketing in Chinese Small and Medium Enterprises (SMEs): The State of the Art in a Chinese Socialist Economy

This paper adopts the context-embedded approach to examine the marketing practices of 307 small and medium enterprises (SMEs) in the People’’s Republic of China by comparing the survey findings with that of Hong Kong and Guangdong SMEs. Chinese SMEs focus on regional markets to avoid direct competition with Hong Kong SMEs in the international markets and also their Guangdong counterparts in the turbulent nationwide market. To market their own brands, Chinese SMEs have to analyze the market and use superior marketing strategies in the competitive markets. Chinese SMEs do not attain the superior competitive positions as that of their Guangdong counterparts, but they use customer satisfaction surveys and claims investigation to help develop excellence in product performance. Also, Chinese SMEs have to provide value-added products and services and also a well-rounded marketing competitive strategy to gain market shares. The traditional state-owned enterprise structure in China facilitates the development of hierarchical organizational structure and joint decision making process. Thus, care should be taken in assuming that marketing tools and techniques are equally applicable across all places, even in similar cultural contexts. Socio-cultural influences and mediating environmental factors should be considered when attempting to understand the marketing practices of Chinese small firms, specifically when China is in transition to a socialist market economy.     

Increasing a brand’s competitive clout: the role of market share,consumer preference,and price sensitivity

The market power (or ‘competitive clout’) of a brand is an increasingly important component of modern marketing strategies. However, the factors that enhance a brand’s competitive clout (BCC) are poorly understood. This study therefore suggests an integrated model of BCC and three factors that are proposed to play a role in its formation: (i) consumer price sensitivity; (ii) brand market share; and (iii) consumer brand preferences. These variables are examined both individually and simultaneously to demonstrate the direct effect of each on BCC and how their inter-relationships contribute to BCC. In doing so, a two-step empirical analysis is conducted. First, two multinomial logit models provide an own- and a cross-price response matrix for a chosen set of competitive brands. Secondly, BCC is regressed against the variables of market share, intrinsic preferences, and price sensitivity using an interaction effects regression model. The results of the analysis show that market share is not the only way to increase BCC; in particular, consumer preferences, and especially pricing decisions, are shown to play a key role in developing a strong brand.     

Modeling advertising impact at campaign level: Empirical generalizations relative to long-term advertising profit contribution and its antecedents

Research on advertising effectiveness is focused on sales and provides few empirical generalizations on profitability and its antecedents. To fill this gap, we develop an econometric model to capture the impact of advertising at campaign level, using retail panel data coupled with TV audience tracking data. Our study involves 31 brands from six packaged goods categories observed weekly and nationally over 4 years and representing 264 TV campaigns. Although we confirm empirical generalizations on the capacity of advertising to increase sales, we establish a different picture for profitability. Only 11 % of campaigns make a positive contribution to profit. Advertising is more profitable for challengers and medium brands, whereas leaders and small brands (recent or established) have a lower profitability. Advertising intensity in the category and campaign carry-over emerge as the strongest (respectively) negative and positive drivers of profitability. The antecedents of carry-over are also analyzed and discussed.     

Billboard and cinema advertising: Missed opportunity or spoiled arms?

Advertising remains one of the most popular marketing instruments, and many studies have studied its sales effectiveness. However, prior research has either looked at the total spending of a brand/firm, or has focused on the most popular media, especially TV advertising. Even though huge amounts are also spent on “smaller” media such as billboards and cinema, little is known on their effectiveness.     

Vertical Product Differentiation and Advertising

A duopoly model is developed in which firms' strategic variables include brand quality, the number of distinct market segments to enter and price. Informative advertising is used to overcome consumer ignorance about brands. In contrast to many existing models in which firms engage in price competition, the subgame perfect equilibria of the game are not characterised by the production of vertically differentiated products. Further, whilst the firms typically produce identical high quality products, in some circumstances the production of homogeneous low quality brands can be an equilibrium strategy.     

The impact of advertising on consumer price sensitivity in experience goods markets

In this paper we use Nielsen scanner panel data on four categories of consumer goods to examine how TV advertising and other marketing activities affect the demand curve facing a brand. Advertising can affect consumer demand in many different ways. Becker and Murphy (Quarterly Journal of Economics 108:941–964, 1993) have argued that the “presumptive case” should be that advertising works by raising marginal consumers’ willingness to pay for a brand. This has the effect of flattening the demand curve, thus increasing the equilibrium price elasticity of demand and the lowering the equilibrium price. Thus, “advertising is profitable not because it lowers the elasticity of demand for the advertised good, but because it raises the level of demand.” Our empirical results support this conjecture on how advertising shifts the demand curve for 17 of the 18 brands we examine. There have been many prior studies of how advertising affects two equilibrium quantities: the price elasticity of demand and/or the price level. Our work is differentiated from previous work primarily by our focus on how advertising shifts demand curves as a whole. As Becker and Murphy pointed out, a focus on equilibrium prices or elasticities alone can be quite misleading. Indeed, in many instances, the observation that advertising causes prices to fall and/or demand elasticities to increase, has misled authors into concluding that consumer “price sensitivity” must have increased, meaning the number of consumers’ willing to pay any particular price for a brand was reduced—perhaps because advertising makes consumers more aware of substitutes. But, in fact, a decrease in the equilibrium price is perfectly consistent with a scenario where advertising actually raises each individual consumer’s willingness to pay for a brand. Thus, we argue that to understand how advertising affects consumer price sensitivity one needs to estimate how it shifts the whole distribution of willingness to pay in the population. This means estimating how it shifts the shape of the demand curve as a whole, which in turn means estimating a complete demand system for all brands in a category—as we do here. We estimate demand systems for toothpaste, toothbrushes, detergent and ketchup. Across these categories, we find one important exception to conjecture that advertising should primarily increase the willingness to pay of marginal consumers. The exception is the case of Heinz ketchup. Heinz advertising has a greater positive effect on the WTP of infra-marginal consumers. This is not surprising, because Heinz advertising focuses on differentiating the brand on the “thickness” dimension. This is a horizontal dimension that may be highly valued by some consumers and not others. The consumers who most value this dimension have the highest WTP for Heinz, and, by focusing on this dimension; Heinz advertising raises the WTP of these infra-marginal consumers further. In such a case, advertising is profitable because it reduces the market share loss that the brand would suffer from any given price increase. In contrast, in the other categories we examine, advertising tends to focus more on vertical attributes.

Advertising non-premium products as if they were premium: The impact of advertising up on advertising elasticity and brand equity

Non-premium brands occasionally emulate their premium counterparts by using ads that emphasize premium characteristics such as superior performance and exclusivity. We define this practice as “advertising up” and develop hypotheses about its short- and long-term impact on advertising elasticity and brand equity respectively. We test the hypotheses in two large-scale empirical studies using a comprehensive dataset from the automotive industry that includes, among others, the content of 2317 television ads broadcast over a period of 45?months. The results indicate that advertising up increases (decreases) short-term advertising elasticity for non-premium products with a low (high) market share. The results also show that an intensive use of advertising up over time leads to long-term improvements (reductions) in brand equity for expensive (cheap) non-premium products. Furthermore, an inconsistent use of advertising up leads to reductions in brand equity. The results imply that managers of non-premium products with a low market share can use advertising up to increase advertising effectiveness in the short run. However, advertising up will only generate long-term improvements in brand equity for expensive non-premium products. Finally, to avoid long-term reductions in brand equity, advertising up should be consistently used over time.     

Going for gold: Investigating the (non)sense of increased advertising around major sports events

Major sports events draw unsurpassed media attention. Companies are motivated to increase their advertising investments around these events to reach large audiences in a short period. Is such an advertising surge actually beneficial though, or should companies avoid advertising in these periods because of negative effects of competitive interference? This study investigates when consumer packaged goods companies should invest in advertising to increase sales: before, during, or after the event or outside these event periods. The author estimates short- and long-term own- and cross-advertising elasticities for 206 brands using four years of weekly data. Although considerable heterogeneity exists across brands, own-advertising effectiveness diminishes especially before and during major sports events, in both the short and the long run. In addition, brands benefit less from category-demand effects through competitors' advertising. Conversely, greater increases in advertising spending resulting in significant growth in share of voice around focused, single-sport events are a successful strategy to overcome this overall general negative trend.     

An empirical analysis of national and local advertising effect on price elasticity

This paper investigates the interaction effect of advertising and price on the market share of a consumer nondurable product. We postulate a model in which local advertising is thought to primarily affect the consumers' purchase by making the demand more price sensitive, and national advertising to affect the consumers' preference, thus making the demand less price sensitive. Moreover, we hypothesize that local advertising interaction will have more immediate effect, while national advertising interaction will have longer term interaction effects. We apply these ideas empirically, and find support for our hypotheses. Thus, the interaction effect of advertising and price can be characterized by both increased and decreased price sensitivity, depending on the type of advertising. Moreover, these effects may be present simultaneously for the same product.     

Interplays between manufacturer advertising and retailer store brand introduction: Agency vs. wholesale contracts

In retail supply chains, manufacturers' advertising for national brands and retailers' store brand introduction may relate to each other, and two types of contracts, i.e., agency contract and wholesale contract, are widely used. This paper uses game-theoretic models to investigate the strategic interaction between a manufacturer's advertising strategy and a retailer's store brand introduction strategy. We derive the equilibrium outcomes, including wholesale price, retail price, market demand, retailer's and manufacturer's profits under different contract forms. We find that when the product cost is small relative to the perceived value of the store brand, the introduction of a store brand will benefit the retailer. The retailer is more likely to introduce store brands under the wholesale contract than under the agency contract. In addition, compared with the wholesale contract, the agency contract may increase both the manufacturer's and the retailer's profits and lead to Pareto improvement for them.