IDEAS home Printed from https://ideas.repec.org/a/tpr/restat/v75y1993i4p649-56.html
   My bibliography  Save this article

The Sales and Competitive Effects of Styling and Advertising Practices in the U.S. Auto Industry

Author

Listed:
  • Kwoka, John E, Jr

Abstract

This paper utilizes a detailed data set on most U.S. car models over a twenty-two-year period to determine the impact of advertising and product styling. It finds that, while advertising and style change each increases a model's sales, advertising is short-lived but styling has a much longer impact. Rivals' styling reduces own-model sales to the point that the overall market effect is self-canceling. Rivals' advertising, by contrast, does not greatly affect own sales, so that marketwide advertising does increase total sales. These results add several twists to previous analyses of this industry. Copyright 1993 by MIT Press.

Suggested Citation

  • Kwoka, John E, Jr, 1993. "The Sales and Competitive Effects of Styling and Advertising Practices in the U.S. Auto Industry," The Review of Economics and Statistics, MIT Press, vol. 75(4), pages 649-656, November.
  • Handle: RePEc:tpr:restat:v:75:y:1993:i:4:p:649-56
    as

    Download full text from publisher

    File URL: http://links.jstor.org/sici?sici=0034-6535%28199311%2975%3A4%3C649%3ATSACEO%3E2.0.CO%3B2-W&origin=bc
    File Function: full text
    Download Restriction: Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Peter Scott & James Walker, 2010. "Sales and Advertising Rivalry in Interwar US Department Stores," Economics & Management Discussion Papers em-dp2009-05, Henley Business School, Reading University.
    2. Korenok, Oleg & Hoffer, George E. & Millner, Edward L., 2010. "Non-price determinants of automotive demand: Restyling matters most," Journal of Business Research, Elsevier, vol. 63(12), pages 1282-1289, December.
    3. David A. Soberman, 2004. "Research Note: Additional Learning and Implications on the Role of Informative Advertising," Management Science, INFORMS, vol. 50(12), pages 1744-1750, December.
    4. Nichols, Mark W. & Fournier, Gary M., 1999. "Recovering from a bad reputation: changing beliefs about the quality of U.S. autos," International Journal of Industrial Organization, Elsevier, vol. 17(3), pages 299-318, April.
    5. Ana M. Aizcorbe & Martha Starr-McCluer & James T. Hickman, 2003. "The replacement demand for motor vehicles: evidence from the Survey of Consumer Finances," Finance and Economics Discussion Series 2003-44, Board of Governors of the Federal Reserve System (U.S.).
    6. repec:rdg:wpaper:em-dp2008-56 is not listed on IDEAS
    7. Peter Scott & James Walker, 2010. "Advertising, promotion, and the competitive advantage of interwar British department stores," Economic History Review, Economic History Society, vol. 63(4), pages 1105-1128, November.
    8. Matthias Greuner & David Kamerschen & Peter Klein, 2000. "The Competitive Effects of Advertising in the US Automobile Industry, 1970-94," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 7(3), pages 245-261.
    9. González, Eduardo & Cárcaba, Ana & Ventura, Juan, 2015. "How car dealers adjust prices to reach the product efficiency frontier in the Spanish automobile market," Omega, Elsevier, vol. 51(C), pages 38-48.
    10. Requena-Silvente, Francisco & Walker, James, 2007. "Investigating sales and advertising rivalry in the UK multipurpose vehicle market (1995-2002)," Journal of Economics and Business, Elsevier, vol. 59(2), pages 163-180.
    11. Larkin, Yelena, 2013. "Brand perception, cash flow stability, and financial policy," Journal of Financial Economics, Elsevier, vol. 110(1), pages 232-253.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:tpr:restat:v:75:y:1993:i:4:p:649-56. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Kristin Waites). General contact details of provider: http://mitpress.mit.edu/journals/ .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.