The Influence of Market Structure on Industry Advertising Intensity

Brush, Brian C.

doi:10.2307/2097897

Cited by 22 publications

(7 citation statements)

References 10 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Although this is the first use of this measure of PCM in an advertising intensity study, the result agrees with the bulk of previous theoretical and empirical findings that the profit contribution of additional sales positively influences advertising, a potential means of increasing sales. Moreover, the magnitude of the coefficient is generally consistent with previous empirical findings (Brush, 1976;Farris and Buzzell, 1979).…”

Section: N Empirical Resultssupporting

confidence: 89%

Market Share Dispersion Among Leading Firms as a Determinant of Advertising Intensity

Willis

Rogers

1998

Review of Industrial Organization

View full text Add to dashboard Cite

Section: N Empirical Resultssupporting

confidence: 89%

Market Share Dispersion Among Leading Firms as a Determinant of Advertising Intensity

Willis

Rogers

1998

Review of Industrial Organization

View full text Add to dashboard Cite

“…Beyond demonstrating the effects of forced unbundling through digitization on the release behavior of music firms, our paper contributes to the strand of literature concerned with how firms market their products and compete for attention. First, our finding of the non-linear effect of competition on amount of advertising adds product-level evidence to the classic literature (Sutton, 1974;Reekie, 1975;Rees, 1975;Brush, 1976;Ehrlich and Fisher, 1982) which studied competition only at the industry level. Our findings provide further evidence that consumer awareness of products affects sales in certain industries (Cai et al, 2009;Hendricks and Sorensen, 2009a;Tucker and Zhang, 2011;Hendricks et al, 2012) and shows that firms do take this into account in their strategy.…”

Section: Discussionsupporting

confidence: 60%

“…This relationship has been established in the past using industry-level data(Greer, 1971;Cable, 1972;Sutton, 1974;Brush, 1976;Strickland and Weiss, 1976;Martin, 1979;Buxton et al, 1984;Willis and Rogers, 1998), though not at the level of individual products.…”

mentioning

confidence: 99%

Loudness War: How Record Labels Compete for Consumer Attention

2014

View full text Add to dashboard Cite

In markets with thousands of products, firms cannot take it for granted that consumers are even aware of their articles' existence. Advertising and actions to attract consumer attention are therefore integral components of a firm's competitive toolbox. We study firms' behavior in a perfect example for such a market: The music industry, in which consumers can choose from a plethora of albums and songs. We study a specific strategic instrument of firms, single releases, applying unique micro-level data. Arguing that the digitization of the industry via MP3, filesharing, and iTunes amounts to forced unbundling, the role of singles has changed from individual revenue generators (pre-digital era) to pure attention gatherers. In accordance with this driving hypothesis, we observe an inverse U-shaped relationship between competition intensity and the number of singles released in the digital era, while previously competition had a purely negative effect.

show abstract

“…See, for example, Greer [1971], Cable [1972], Brush [1976], and the survey provided by Albion andFarris [1981, ch. Previous studies of interindustry differences in sellers' outlays on information have utilized only advertising as a dependent variable and in many cases have concentrated only on seller competition in the product market as a determining influence.…”

Section: E ( X I ) = ( Q a N / A N ) ( A N / A X I ) ( X I / Q N )mentioning

confidence: 99%

“…Previous studies of interindustry differences in sellers' outlays on information have utilized only advertising as a dependent variable and in many cases have concentrated only on seller competition in the product market as a determining influence. See, for example, Greer [1971], Cable [1972], Brush [1976], and the survey provided by Albion andFarris [1981, ch. 61.…”

Section: E ( X I ) = ( Q a N / A N ) ( A N / A X I ) ( X I / Q N )mentioning

confidence: 99%

Information Structures of Product Markets

Caves

1986

Economic Inquiry

View full text Add to dashboard Cite

Buyers demand continuing information flows to guide their choices among competing product brands. They select portfolios of information types, some supplied by sellers of the branded goods, some not. This paper investigates the determinants of businesses' outlays on information (media advertising, sales force, other sales promotion). They include buyers' overall' demands for information, buyers' access to sources not controlled by the seller, the relative efficiency of seller-supplied information, and competitive conditions in the product market. The hypotheses about effects on sellers' totd information outlaysare strongly supported. Some evidence appears on determinants of the mixture of information types they provide.Buyers acquire information in order to assist their choice between competing hands of a product. Sellers supply some of this information; some comes from independent sources. We have little systematic positive knowledge of what determines the size and composition of these flows of information, yet a number of normative issues in the field of industrial organization turn on the structure and performance of this informational complement to the product market. Do heavy outlays on advertising represent a response to buyers' demands for information, or do they entail some form of market failure? In this paper we employ a proprietary data base to expose some determinants of these information flows.

show abstract

The Influence of Market Structure on Industry Advertising Intensity

Cited by 22 publications

References 10 publications

Market Share Dispersion Among Leading Firms as a Determinant of Advertising Intensity

Market Share Dispersion Among Leading Firms as a Determinant of Advertising Intensity

Loudness War: How Record Labels Compete for Consumer Attention

Information Structures of Product Markets

Contact Info

Product

Resources

About