nep-mkt New Economics Papers
on Marketing
Issue of 2009‒05‒02
nine papers chosen by
Joao Carlos Correia Leitao
Technical University of Lisbon

  1. How Does Advertising Affect Market Performance? The Case of Generic Advertising By Hamilton, Stephen F.; Richards, Timothy J.; Stiegert, Kyle W.
  2. Dynamic perceptual mapping By Michael Greenacre
  3. Product Differentiation and Market Segmentation in Applesauce: Usnig a Choice Experiment to Assess the Value of Organic, Local and Nutrition Attributes By James, Jennifer S.; Rickard, Bradley J.; Rossman, William J.
  4. Evaluating Marketing Channel Options for Small-Scale Fruit and Vegetable Producers: Case Study Evidence from Central New York By LeRoux, Matthew N.; Schmit, Todd M.; Roth, M.; Streeter, Deborah H.
  5. Consumer Preferences for U.S. Pork in Urban China By Ortega, David L.; Wang, H. Holly; Wu, Laping
  6. Competition for attention in the information (overload) age By Anderson, Simon P; de Palma, André
  7. Actes des 13èmes Journées de Recherche en Marketing de Bourgogne. Distribution, achat, consommation - produits, services, culture, loisirs, tourisme. Dijon, 13-14 novembre 2008. By FILSER, Marc
  8. Supermarkets, Modern Supply Chains, and the Changing Food Policy Agenda By Peter Timmer
  9. The Economics of Collective Brands By Fishman, Arthur; Finkelshtain, Israel; Simhon, Avi; Yacouel, Nira

  1. By: Hamilton, Stephen F.; Richards, Timothy J.; Stiegert, Kyle W.
    Abstract: The effect of advertising on market performance has been a long-standing debate. Advertising that increases the dispersion of consumersâ valuations for advertised goods raises the market power of firms, while advertising that decreases the dispersion of consumersâ valuations leads to narrower price-cost margins and superior performance in markets for advertised goods. Numerous challenges confound the empirical identification of advertising effects on market performance. This paper proposes a simple method that relies on the revealed preferences of firms participating in generic advertising programs. Generic advertising programs provide a unique window through which to observe advertising effects on market performance, because changes in the dispersion of consumersâ valuations systematically redistributes rents among firms according to observable characteristics on producer size. We examine producer attitudes towards generic advertising in the âBeef. Itâs Whatâs for Dinnerâ campaign of the U.S. Beef Checkoff program and find the likelihood a producer favors an expansion of the advertising program increases in operating scale. This finding is consistent with advertising effects that have led to a decrease in the dispersion of consumersâ valuations for beef products and a commensurate increase in market performance.
    Keywords: Advertising, Oligopoly, Marketing, L1, M37,
    Date: 2009
  2. By: Michael Greenacre
    Abstract: Perceptual maps have been used for decades by market researchers to illuminate them about the similarity between brands in terms of a set of attributes, to position consumers relative to brands in terms of their preferences, or to study how demographic and psychometric variables relate to consumer choice. Invariably these maps are two-dimensional and static. As we enter the era of electronic publishing, the possibilities for dynamic graphics are opening up. We demonstrate the usefulness of introducing motion into perceptual maps through four examples. The first example shows how a perceptual map can be viewed in three dimensions, and the second one moves between two analyses of the data that were collected according to different protocols. In a third example we move from the best view of the data at the individual level to one which focuses on between-group differences in aggregated data. A final example considers the case when several demographic variables or market segments are available for each respondent, showing an animation with increasingly detailed demographic comparisons. These examples of dynamic maps use several data sets from marketing and social science research.
    Keywords: Animation, brand-attribute maps, correspondence analysis, multidimensional scaling, perceptual map, visualization
    JEL: C19 C88
    Date: 2009–04
  3. By: James, Jennifer S.; Rickard, Bradley J.; Rossman, William J.
    Abstract: Recently there is much interest among horticultural producers concerning the marketing of organically- and locally- produced food. Here we developed a consumer survey that asked respondents to choose an applesauce product from a list of products differentiated by price and four attributes. The products were differentiated by labels that described fat content, nutrition content, and whether the product was grown organically and/or locally. The survey was distributed to 3,000 residents in rural Pennsylvania and over 1,500 responses were collected yielding a response rate of 56%. Survey results were used to assess consumersâ willingness to pay for the product attributes in applesauce, and we found that consumers were willing to pay more for locally-grown applesauce compared to applesauce that was labeled organic or low fat and low sugar. Furthermore, the analysis incorporated the effects of consumer characteristics on the demand for applesauce attributes and we find evidence that increased knowledge of agriculture decreases the willingness to pay for organically- and locally-grown applesauce.
    Keywords: Applesauce, Choice experiment, Consumer demand, Fruit and vegetable markets, Locally grown, Multinomial logit model, Organic, Pennsylvania, Willingness to pay, Agribusiness, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety, Q13,
    Date: 2009–01–29
  4. By: LeRoux, Matthew N.; Schmit, Todd M.; Roth, M.; Streeter, Deborah H.
    Abstract: An investigation of the relative costs and benefits of marketing channels used by typical small-scale diversified vegetable crop producers is conducted. Using case study evidence from four small farms in Central New York, this study compares the performance of wholesale and direct marketing channels, including how the factors of risk, owner and paid labor, price, lifestyle preferences, and sales volume interact to impact optimal market channel selection. Given the highly perishable nature of the crops grown, along with the risks and potential sales volume of particular channels, a combination of different marketing channels is needed to maximize overall firm performance. Accordingly, a ranking system is developed to summarize the major firm-specific factors across channels and to prioritize those channels with the greatest opportunity for success based on individual firm preferences.
    Keywords: Marketing channel, small-scale, fruit and vegetable producers, case study, Agribusiness, Crop Production/Industries, Financial Economics,
    Date: 2009–04
  5. By: Ortega, David L.; Wang, H. Holly; Wu, Laping
    Abstract: Chinaâs transition into a developed economy is driving changes in consumer preferences and demand for foods. To evaluate consumer preferences for U.S. pork in urban China, primary data were collected in two metropolitan areas- Beijing and Shanghai. Estimated logit models revealed that an individualâs age, shopping location and food safety concerns significantly influenced their willingness-to-pay for U.S. pork. A proportional linear model was developed to evaluate factors affecting purchasing behavior of western-style pork cuts vs. traditional Chinese cuts. Food safety concerns were linked to a previous lean-meat additive scare and a lack of consumer confidence on the Chinese food inspection system.
    Keywords: China, U.S. Pork, Willingness-to-pay, Ordered Logit, food safety, Agricultural and Food Policy, Consumer/Household Economics, Marketing, D120, D190, M390, Q130, Q180,
    Date: 2009
  6. By: Anderson, Simon P; de Palma, André
    Abstract: Limited consumer attention limits product market competition: prices are stochastically lower the more attention is paid. Ads compete to be the lowest price with other ads from the same sector and they compete for attention with ads from other sectors: equilibrium sector ad shares under free entry follow a CES form. When a sector gets more attractive, its advertising expands: others lose ad market share but may increase in absolute terms if sufficiently attractive. The "information hump" shows highest ad levels for intermediate attention levels when there is a decent enough chance of getting the message across and also of not being undercut by a cheaper offer. The Information Age takes off when the number of sectors grows, but total ad volume reaches an upper limit. Overall, advertising is excessive, though the allocation across sectors is optimal. Nonetheless, both large sectors and small ones can be blamed for misallocation of ads in using up scarce attention.
    Keywords: advertising distribution; consumer attention; economics of attention; information age; information filtering; price dispersion; size distribution of firms
    JEL: D11 D60 I0 L13
    Date: 2009–04
  7. By: FILSER, Marc (LEG-CERMAB - CNRS UMR 5118 - IAE - Université de Bourgogne)
    Keywords: Distribution ; achat ; consommation - produits ; services ; culture ; loisirs ; tourisme
    Date: 2008–11
  8. By: Peter Timmer
    Abstract: There is great interest among policy makers in how to influence the behavior of supermarkets in ways that serve the interests of important groups in society, especially small farmers and the owners of traditional, small-scale food wholesale and retail facilities. Two broader issues are also important: (1) finding a way for food prices to “internalize” the full environmental costs of production and marketing; and (2) finding a way for supermarkets to be part of the solution, rather than part of the problem, to the health problems generated by an “affluent” diet and lifestyle. There are concerns over the growing concentration in global food retailing and the potential market power that concentration implies. But the evidence of fierce competition at the retail level, and the high contestability for food consumers’ dollars, have kept this issue in the background. The ultimate impact of supermarkets in developing countries will be on the level and distribution of improved welfare for consumers. What happens to small farmers, traditional traders and mom-and-pop shops will be factors in both the size of welfare gains and their distribution, but many other factors will also come into play. Our judgment on the impact of the supermarket revolution must incorporate all of those factors. This paper places the supermarket debate in the broader evolution of food policy analysis, which is a framework for integrating household, market, macro and trade issues as they affect hunger and poverty. Increasingly, supermarkets provide the institutional linkages across these issues.
    Keywords: Food policy; agricultural diversification; structural transformation; poverty
    JEL: O13 O30 Q13
    Date: 2009–03
  9. By: Fishman, Arthur; Finkelshtain, Israel; Simhon, Avi; Yacouel, Nira
    Abstract: We consider the consequences of a shared brand name such as geographical names used to identify high quality products, for the incentives of otherwise autonomous firms to invest in quality. We contend that such collective brand labels improve communication between sellers and consumers, when the scale of production is too small for individual firms to establish reputations on a stand alone basis. This has two opposing effects on member firmsâ incentives to invest in quality. On the one hand, it increases investment incentives by increasing the visibility and transparency of individual member firms, which increases the return from investment in quality. On the other hand, it creates an incentive to free ride on the groupâs reputation, which can lead to less investment in quality. We identify parmater values under which collective branding delivers higher quality than is achievable by stand alone firms.
    Date: 2008–12–15

This nep-mkt issue is ©2009 by Joao Carlos Correia Leitao. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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