Price commitment and the strategic launch of a fighter brand

Abstract We consider a vertically differentiated market where an incumbent strategically wants to launch fighter brand thwart new entrant. Without credibly commitment this is ineffective because the always has incentive price ex-post out of market. Endogenous leadership with fixed or list announcement, and dual channeling intermediary retailer distribute are analyzed as devices. The optimal mode then depends on customers’ sensitivities deviation from announcement well attractiveness underlying