Push-me pull-you: comparative advertising in the OTC analgesics industry.

We derive equilibrium incentives to use comparative advertising that pushes up own brand perception and pulls down the brand image of targeted rivals. Data on content and spending for all TV advertisements in Over-The- Counter (OTC) analgesics enable us to construct matrices of rival targeting expen...

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Published in:RAND Journal of Economics (Wiley-Blackwell) Vol. 47; no. 4; pp. 1029 - 1057
Main Authors: Anderson, Simon P., Ciliberto, Federico, Liaukonyte, Jura, Renault, Régis
Format: Article
Published: Wiley-Blackwell Winter2016
Subjects:
Online Access:View this record in EBSCOhost
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        atl: Push-me pull-you: comparative advertising in the OTC analgesics industry.
      aug:
        au:
          Anderson, Simon P.
          Ciliberto, Federico
          Liaukonyte, Jura
          Renault, Régis
        affil:
          University of Virginia
          Cornell University
          Université de Cergy ‐ Pontoise, ThEMA
      su:
        Consumption (Economics)
        Corporate profits
        Analgesics industry
        Branding (Marketing)
        Over-the-counter markets
      sug:
        subj:
          Consumption (Economics)
          Pharmaceutical Preparation Manufacturing
          Pharmaceutical and medicine manufacturing
          Corporate profits
          Analgesics industry
          Branding (Marketing)
          Over-the-counter markets
      ab: We derive equilibrium incentives to use comparative advertising that pushes up own brand perception and pulls down the brand image of targeted rivals. Data on content and spending for all TV advertisements in Over-The- Counter (OTC) analgesics enable us to construct matrices of rival targeting expenditures and estimate the structural model. Using brands' optimal choices, these attack matrices identify diversion ratios, from which we derive comparative advertising damage measures. We find that comparative advertising causes more damage to the targeted rival than benefit to the advertiser. We simulate banning comparative advertising to find industry profits rise.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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