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Advertising Originality Decisions in Competition

Author

Listed:
  • Chun (Martin) Qiu

    (Wilfrid Laurier University)

  • Demetrios Vakratsas

    (McGill University)

  • Filippo Dall’Olio

    (McGill University)

Abstract

Originality is a critical determinant of advertising success. However, firms frequently opt to launch unoriginal advertising campaigns. Why would firms opt for unoriginal ads when originality is considered as the “pinnacle”? In this paper, the authors investigate advertising originality decisions for market leaders and followers. They first establish empirically that unoriginal advertising, and more specifically copycat advertising, is a common option across diverse markets even for leading brands. Then, they develop an analytical framework to investigate the optimality of originality decisions. They model creative advertising themes as a “best-shot” type of public good, where a firm’s originality decision is influenced by market structure as well as market growth. The authors then examine whether a firm creates an original ad or opts for an unoriginal one, either by copycatting a competitor or by remaking an existing ad theme. The findings suggest that there is no oversupply of original ads. An original ad can be created by either the leading firm or its follower to boost the valuation of its loyal consumers and profit from higher prices or to attract switchers.

Suggested Citation

  • Chun (Martin) Qiu & Demetrios Vakratsas & Filippo Dall’Olio, 2019. "Advertising Originality Decisions in Competition," Customer Needs and Solutions, Springer;Institute for Sustainable Innovation and Growth (iSIG), vol. 6(1), pages 13-25, June.
    • Handle: RePEc:spr:custns:v:6:y:2019:i:1:d:10.1007_s40547-019-00095-0
    DOI: 10.1007/s40547-019-00095-0
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