Measuring the Short-Term Effect of In-Store Promotion and Retail Advertising on Brand Sales: A Factorial Experiment

In a replicated in-store factorial experiment with 12 national brands in six non-perishable consumer goods categories, the authors find price deal elasticities in the [2-11] range, with larger values for smaller brands. Those elasticities increase 20% to 180% when deals are advertised by the retaile...

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Bibliographic Details
Published in:Journal of marketing research 1991-05, Vol.28 (2), p.202-214
Main Authors: Bemmaor, Albert C., Mouchoux, Dominique
Format: Article
Language:English
Subjects:
Advertising to sales ratios
Brands
Comparative studies
Direct sales
Effects
Factorial experiments
Marketing
Mathematical models
Modeling
Price cuts
Price elasticity
Regression analysis
Retail stores
Retail trade
Sales
Sales promotions
Short term
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Summary:In a replicated in-store factorial experiment with 12 national brands in six non-perishable consumer goods categories, the authors find price deal elasticities in the [2-11] range, with larger values for smaller brands. Those elasticities increase 20% to 180% when deals are advertised by the retailer; the rates of increase are smaller for the leading brands. The price deal cross-elasticities of the higher priced brands are found to be smaller than those of the other brands; they are in the [2-2.7] range. Optimal retail deal rates are shown to be robust to model specification.
ISSN:0022-2437
1547-7193
DOI:10.1177/002224379102800207