Price and Advertising Signals of Product Quality PDF Download
Are you looking for read ebook online? Search for your book and save it on your Kindle device, PC, phones or tablets. Download Price and Advertising Signals of Product Quality PDF full book. Access full book title Price and Advertising Signals of Product Quality by Paul Robert Milgrom. Download full books in PDF and EPUB format.
Author: Paul Robert Milgrom
Publisher:
ISBN:
Category : Advertising
Languages : en
Pages : 28
Get Book Here
Book Description
Author: Paul Robert Milgrom
Publisher:
ISBN:
Category : Advertising
Languages : en
Pages : 28
Get Book Here
Book Description
Author: Juan Feng
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Get Book Here
Book Description
Performance-based advertising is becoming increasingly popular in the online advertising industry, where the advertiser pays to the publisher only when an "action" (e.g., a click-through) is generated by the advertisement. We study how the performance-based advertising scheme affects one of the fundamental functions of advertising - signaling product quality. We identify two critical factors that affect the signaling function of advertising under performance-based pricing: (1) the demand uncertainty factor, which measures advertisers' uncertainty about their potential market, and (2) the advertising performance over-measure factor, which describes the extent to which product performance accounts for advertising performance. We find that the uncertainty factor facilitates, but the over-measure factor impedes (or even destroys) the signaling function of performance-based advertising. Specifically, our results show that in the presence of the over-measure factor, switching from impression-based to performance-based advertising: (a) reduces the number of situations in which advertising can be used to signal quality, (b) increases the prices charged to consumers, (c) increases the expected advertising expenditure if the cost differentiation between the high- and low-quality firms is sufficiently high, but decreases the expected advertising expenditure otherwise, and (d) increases the advertiser's profit if the over-measure factor is low but the uncertainty factor is high, and decreases the profit otherwise.
Author: Steven A. Matthews
Publisher:
ISBN:
Category :
Languages : en
Pages : 42
Get Book Here
Book Description
Author: Scott Shane
Publisher:
ISBN:
Category :
Languages : en
Pages : 36
Get Book Here
Book Description
Author: Federal Trade Federal Trade Commission
Publisher: CreateSpace
ISBN: 9781514156995
Category :
Languages : en
Pages : 48
Get Book Here
Book Description
Can price and advertising be used by vertically differentiated duopolists to signal qualities to consumers? We show that pure price separation is impossible if the vertical differentiation is small, while adding dissipative advertising ensures existence of separating equilibria. Two simple, but non-standard, equilibrium refinements are introduced to deal with the multi-sender nature of the game, and they are shown to produce a unique separating and a unique pooling profile. Pooling results in a zero-profit Bertrand outcome. Separation gives strictly positive duopoly profits, and dissipative advertising is used by the high-quality firm when products are sufficiently close substitutes. Finally, depending on the differentiation, the separating prices of both firms may be distorted upwards or downwards compared to the complete information benchmark.
Author: Federal Trade Federal Trade Commission
Publisher: Createspace Independent Publishing Platform
ISBN: 9781530892402
Category :
Languages : en
Pages : 48
Get Book Here
Book Description
Can price and advertising be used by vertically differentiated duopolists to signal qualities to consumers? We show that pure price separation is impossible if the vertical differentiation is small, while adding dissipative advertising ensures existence of separating equilibria. Two simple, but non-standard, equilibrium refinements are introduced to deal with the multi-sender nature of the game, and they are shown to produce a unique separating and a unique pooling profile. Pooling results in a zero-profit Bertrand outcome. Separation gives strictly positive duopoly profits, and dissipative advertising is used by the high-quality firm when products are sufficiently close substitutes. Finally, depending on the differentiation, the separating prices of both firms may be distorted upwards or downwards compared to the complete information benchmark.
Author: Tulin Erdem
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Get Book Here
Book Description
In this paper, we develop a structural model of household behavior in an environment where there is uncertainty about brand attributes, and both prices and advertising signal brand quality. Four quality signaling mechanisms are at work in the model: 1) price signals quality, 2) advertising frequency signals quality, 3) advertising content provides direct (but noisy) information about quality, and 4) use experience provides direct (but noisy) information about quality. We estimate our proposed model using scanner panel data on ketchup. If price is important as a signal of brand quality, then frequent price promotion may have the unintended consequence of reducing brand equity. We use our estimated model to measure the importance of such effects. Our results imply that price is an important quality signaling mechanism, and that frequent price cuts can have significant adverse effects on brand equity. The role of advertising frequency in signaling quality is also significant, but it is less quantitatively important than price.
Author: Scott Davis
Publisher:
ISBN:
Category : Consumer behavior
Languages : en
Pages : 302
Get Book Here
Book Description
Author: Doron Fertig
Publisher:
ISBN:
Category : Quality of products
Languages : en
Pages : 143
Get Book Here
Book Description
Author: Centre de recherche en économie et statistique (Paris, France)
Publisher:
ISBN:
Category : Marketing
Languages : en
Pages : 32
Get Book Here
Book Description
