Dynamics of Price Elasticity and Brand Life Cycles: An Empirical Study

Simon, Hermann

doi:10.2307/3150805

Cited by 74 publications

(42 citation statements)

References 10 publications

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“…The broadest evidence for brand life cycles is available for pharmaceuticals. Bauer and Fischer (2000), Corstjens et al (2005), Cox (1967), Grabowski and Vernon (1990), Hahn et al (1994), Lilien et al (1981), Rao and Masataka (1988), and Simon (1979) all find strong evidence for the existence of a drug life cycle. In total, these researchers document the life cycles for more than 500 newly introduced drugs.…”

Section: Brand Life Cycles In Drugsmentioning

confidence: 90%

Drivers of peak sales for pharmaceutical brands

2010

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Section: Brand Life Cycles In Drugsmentioning

confidence: 90%

Drivers of peak sales for pharmaceutical brands

2010

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“…Similar to advertising elasticities, variation of price elasticities across brands and categories has been documented. Simon (1979) found a U-shaped relationship between the magnitude of price elasticities and the product life cycle, while Tellis (1988) reported stronger price sensitivities in the later stages of the product life cycle. Bijmolt et al (2004), in turn, reported declining elasticies over the PLC.…”

Section: Price Effectivenessmentioning

confidence: 99%

Advertising and Price Effectiveness over the Business Cycle

Gijsenberg¹,

Heerde

Dekimpe

et al. 2009

SSRN Journal

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In this study, the authors conduct a systematic investigation on the evolution in the effectiveness of two important marketing mix instruments, advertising and price, over the business cycle. Analyses are based on 163 branded products in 37 mature CPG categories in the UK, and this for a period of 15 years. The data are a combination of (i) monthly national sales data, (ii) monthly advertising data, (iii) data on the general economic conditions, and (iv) consumer survey data. Consumers are shown to be more price sensitive during contractions. In addition, spending patterns will be less consistent, implying smaller brand loyalty. Advertising elasticities, however, do not seem to be affected by economic downturns. Product involvement was shown to be an influential moderator of the final effect of advertising, price and carry-over effects on sales. Finally, although short run effectiveness of price differs between expansions and contractions, the long run effectiveness of both advertising and price is not altered by differences in the general economic conditions.

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“…A large literature in marketing has documented the time-varying impact of prices, advertising, distribution and other marketing-mix variables in several product categories (Parsons, 1975;Simon, 1979;Shoemaker, 1986;Lilien and Yoon, 1988;Tellis and Fornell, 1988;Parker, 1994;Parker and Neelamegham, 1997;Danaher et al, 2001). As marketing-mix effects change over the life cycle, the trade-offs to firms of leveraging available marketing instruments for generating sales also changes.…”

Section: Introductionmentioning

confidence: 99%

Measuring marketing‐mix effects in the 32/64 bit video‐game console market

Nair

Sukumar

2009

J of Applied Econometrics

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SUMMARYWe investigate the short-and long-run effects of prices and software availability on the category-level diffusion of 32/64-bit video-game consoles in the USA. We adopt an estimation framework that allows for a flexible intrinsic growth pattern for the hardware consoles, and uses instrumental variables to control for the potential endogeneity of prices. We find significant long-term effects of prices and software availability on sales. We find that using a non-parametric hazard specification is important: imposing parametric forms results in elasticities that are up to 30% smaller. We use these results to derive implications for marketing policies over the life cycle of the industry.

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Dynamics of Price Elasticity and Brand Life Cycles: An Empirical Study

Cited by 74 publications

References 10 publications

Drivers of peak sales for pharmaceutical brands

Drivers of peak sales for pharmaceutical brands

Advertising and Price Effectiveness over the Business Cycle

Measuring marketing‐mix effects in the 32/64 bit video‐game console market

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