The Effect of Marketing Spending on Sales in the Premium Car Segment: New Evidence from Germany
This paper assesses empirically the relationship between marketing expenditures and sales in the premium car segment in Germany. We employ a new data-set which contains model-specific data on sales (i.e. registrations), restyling activities and marketing expenditures at a monthly basis for the years 1998 to 2007. The richness of our data in the time dimension allows for a systematic modeling of product life cycle effects which have been partly ignored in the existing empirical literature. We find a robust positive marketing-sales relationship, even after common characteristics of the product life cycle have been taken into account. Furthermore, our results indicate that the launching of a new model, face lifts and customized packages appear to exert a positive and sizeable effect on sales in the German premium car segment.
|Date of creation:||14 Feb 2012|
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