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An exploratory analysis of the determinants of cooperative advertising participation rates

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  • Matthew Nagler

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Abstract

The paper offers an exploratory empirical investigation of the determinants of cooperative advertising participation rates. Using data for 2,286 brands, we examine the relationship of participation rates to national advertising expenditures by brand. We also consider how participation rates vary with average manufacturers’ margins by industry, average retail margins by category, and additional category-level variables. Reflecting the discrete nature of the dependent variable, the analysis employs discrete choice estimation techniques instead of OLS regression. The results reveal a significant quadratic relationship between advertising and participation rates. We interpret this and other significant findings in the context of existing work. Copyright Springer Science + Business Media, Inc. 2006

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File URL: http://hdl.handle.net/10.1007/s11002-006-4387-0
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Bibliographic Info

Article provided by Springer in its journal Marketing Letters.

Volume (Year): 17 (2006)
Issue (Month): 2 (April)
Pages: 91-102

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Handle: RePEc:kap:mktlet:v:17:y:2006:i:2:p:91-102

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Web page: http://www.springerlink.com/link.asp?id=100312

Related research

Keywords: Cooperative advertising; National advertising; Discrete choice models;

References

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  1. Geroski, P. A., 1982. "Simultaneous equations models of the structure-performance paradigm," European Economic Review, Elsevier, vol. 19(1), pages 145-158.
  2. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January.
  3. Kenneth E. Train & Nate Toyama, 1989. "Pareto Dominance Through Self-Selecting Tariffs: The Case of TOU Electricity Rates for Agricultural Customers," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1), pages 91-109.
  4. Moulton, Brent R, 1990. "An Illustration of a Pitfall in Estimating the Effects of Aggregate Variables on Micro Unit," The Review of Economics and Statistics, MIT Press, vol. 72(2), pages 334-38, May.
  5. Round, David K., 1983. "Intertemporal profit margin variability and market structure in Australian manufacturing," International Journal of Industrial Organization, Elsevier, vol. 1(2), pages 189-209, June.
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  7. Man-Suk Oh & Jung Whan Choi & Dai-Gyoung Kim, 2003. "Bayesian inference and model selection in latent class logit models with parameter constraints: An application to market segmentation," Journal of Applied Statistics, Taylor & Francis Journals, vol. 30(2), pages 191-204.
  8. Thomas J. Steenburgh & Andrew Ainslie & Peder Hans Engebretson, 2003. "Massively Categorical Variables: Revealing the Information in Zip Codes," Marketing Science, INFORMS, vol. 22(1), pages 40-57, August.
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Citations

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Cited by:
  1. Jianqiang Zhang & Weijun Zhong & Shue Mei, 2012. "Competitive effects of informative advertising in distribution channels," Marketing Letters, Springer, vol. 23(3), pages 561-584, September.
  2. Kunter, Marcus, 2012. "Coordination via cost and revenue sharing in manufacturer–retailer channels," European Journal of Operational Research, Elsevier, vol. 216(2), pages 477-486.
  3. Karray, Salma, 2013. "Periodicity of pricing and marketing efforts in a distribution channel," European Journal of Operational Research, Elsevier, vol. 228(3), pages 635-647.
  4. Aust, Gerhard & Buscher, Udo, 2012. "Vertical cooperative advertising and pricing decisions in a manufacturer–retailer supply chain: A game-theoretic approach," European Journal of Operational Research, Elsevier, vol. 223(2), pages 473-482.
  5. Aust, Gerhard & Buscher, Udo, 2014. "Cooperative advertising models in supply chain management: A review," European Journal of Operational Research, Elsevier, vol. 234(1), pages 1-14.
  6. Yang, Jing & Xie, Jinxing & Deng, Xiaoxue & Xiong, Huachun, 2013. "Cooperative advertising in a distribution channel with fairness concerns," European Journal of Operational Research, Elsevier, vol. 227(2), pages 401-407.
  7. SeyedEsfahani, Mir Mehdi & Biazaran, Maryam & Gharakhani, Mohsen, 2011. "A game theoretic approach to coordinate pricing and vertical co-op advertising in manufacturer-retailer supply chains," European Journal of Operational Research, Elsevier, vol. 211(2), pages 263-273, June.
  8. Zhang, Juan & Gou, Qinglong & Liang, Liang & Huang, Zhimin, 2013. "Supply chain coordination through cooperative advertising with reference price effect," Omega, Elsevier, vol. 41(2), pages 345-353.
  9. Anshuman Chutani & Suresh Sethi, 2012. "Cooperative Advertising in a Dynamic Retail Market Oligopoly," Dynamic Games and Applications, Springer, vol. 2(4), pages 347-375, December.

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