This paper examines the role of advertising in the evolution of market structure in the US mutual fund industry. First, I present empirical evidence that mass advertising in this industry creates endogenous sunk costs, resulting in patterns consistent with Sutton’s (1991) predictions. In particular, I contrast evolutionary patterns of advertising spending and market structure between two segmen...

Observatory: New interactive advertising formats on television. A proposal for their analysis and classification This article investigates the area of interactive advertising on television, an emerging phenomenon that has not been extensively explored by the literature and with significant potential for development. The findings provided are based on those obtained as part of the research entit...

This paper develops a model of dynamic advertising competition, and applies it to the problem of optimal advertising scheduling through time. In many industries we observe advertising “pulsing”, whereby firms systematically switch advertising on and off at a high-frequency. Hence, we observe periods of zero and nonzero advertising, as opposed to a steady level of positive advertising. Previous ...

The role of the mobile terminal in advertising and marketing has attached increasing attention, but the traditional advertising acceptance model does not consider how the characteristics of mobile Internet advertising affect consumer attitudes and decision-making. Based on the technology acceptance model (TAM) and the characteristics of groups of college students, a research model of college st...

Does manufacturer advertising for a brand stimulate or suppress retail price promotions? This study addresses this controversial issue. The authors develop an analytical model that shows that the relationship between manufacturer advertising and retail price promotion depends on the role of advertising. If advertising differentiates brands and suppresses consumer response to retail promotion, t...

This study investigated consumers’ attitudes toward advertising by traditional Chinese medicine (TCM) practitioners, and how attitudes varied among different demographic groups and user experiences in TCM. A survey using quota sampling was conducted. Altogether 1,039 adults aged 20 or above in Hong Kong filled in an online questionnaire in March 2014. Factor analysis found that attitudes toward...

A important question that firms face in advertising is developing effective media strategy. Major improvements in the quality of consumer information and the growth of targeted media vehicles allow firms to precisely target advertising to consumer segments within a market. This paper examines advertising strategy when competing firms can target advertising to different groups of consumers withi...

The paper formalizes the intuition that brands are consumed for image reasons and that advertising creates a brand’s image. The key idea is that advertising informs the public of brand names and creates the possibility of conspicuous consumption by rendering brands a signalling device. In a price competition framework, we show that advertising increases consumers’ willingness to pay and thus pr...

Despite the empirical relevance of advertising strategies in concentrated markets, the economics literature is largely silent on the effect of persuasive advertising strategies on pricing, market structure and increasing (or decreasing) dominance. In a simple model of persuasive advertising and pricing with differentiated goods, we analyze the interdependencies between ex-ante asymmetries in co...