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Competitive effects of informative advertising in distribution channels

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Author Info

  • Jianqiang Zhang

    ()

  • Weijun Zhong

    ()

  • Shue Mei

    ()

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    Abstract

    Informative advertising and persuasive advertising play quite different roles in the efficiency of distribution channels. A recent study observes that a direct channel structure outperforms an indirect one in the presence of advertising competition between manufacturers, assuming that advertising is persuasive. On the contrary, taking the informative view of advertising, this paper demonstrates an opposite result: Disintegration does make competing manufacturers better off for highly substitutable goods. We further discuss the optimum control of informative advertising under the indirect channel scenario, showing that retailers are more effective than manufacturers as advertisers. Copyright Springer Science+Business Media, LLC 2012

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    File URL: http://hdl.handle.net/10.1007/s11002-011-9161-2
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    Bibliographic Info

    Article provided by Springer in its journal Marketing Letters.

    Volume (Year): 23 (2012)
    Issue (Month): 3 (September)
    Pages: 561-584

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    Handle: RePEc:kap:mktlet:v:23:y:2012:i:3:p:561-584

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

    Related research

    Keywords: Informative advertising; Channel competition; Distribution channel;

    References

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