1,983 research outputs found
Persistence in foreign exchange rates: derivation of the multivariate persistence estimates and associated standard errors.
Full text linkThe paper provides a technical discussion on how the multivariate persistence measures described in VandeGucht, Kwok and Dekimpe (1993) can be estimated both when cointegration is present and absent. Procedures to derive the associated asymptotic standard errors are discussed.Foreign exchange; Foreign exchange rates;
Measuring Short- and Long-run Promotional Effectiveness on Scanner Data Using Persistence Modeling
Full text linkThe use of price promotions to stimulate brand and firm performance is increasing. We discuss how (i) the availability of longer scanner data time series, and (ii) persistence modeling, have lead to greater insights into the dynamic effects of price promotions, as one can now quantify their immediate, short-run, and long-run effectiveness. We review recent methodological developments, and illustrate how the analysis of numerous brands and product categories has resulted in various empirical generalizations. Finally, we argue that persistence modeling should not only be applied to traditional performance metrics such as sales, but also to metrics such as firm value and customer equity.time-series analysis;scanner data;promotional effectiveness;persistence
How cannibalistic is the internet channel? A study of the newspaper industry in the United Kingdom and the Netherlands.
Full text linkHow Cannibalistic is the Internet Channel?
Full text linkDuring the past decade, irrational exuberance has turned into a possibly equally irrational pessimism about what the Internet can accomplish. The fear of getting ruined through cannibalization losses has recently deterred many firms from deploying the Internet as a distribution channel. But do Internet channels really cannibalize firms' entrenched channels, or is this widely held assumption exaggerated? To answer this question, we apply recent structural-break time-series econometrics to quantify the impact of an Internet channel addition on the long-run performance evolution of a firm's established channels. Using a database of 85 Internet channel additions over the last ten years in the British and Dutch newspaper industries, we find that the often-cited cannibalization fears have been largely overstated. The Internet therefore need not be disruptive to established companies and channels. This does, however, not imply that firms enjoy free play in setting up Internet channels. In cases where the newly established Internet channel too closely mimics the entrenched channels, substantial cannibalization is more likely to take place.cannibalization;internet channel;structural-break time-series analysis
Does Competitive Entry Structurally Change Key Marketing Metrics?
No full textTo what extent does competitive entry create a structural change in keymarketingmetrics? New players may just be a temporal nuisance to incumbents, but could also fundamentally change the latter's performance evolution, or induce them to permanently alter their spending levels and/or pricing decisions. Similarly, the addition of a new marketing channel could permanently shift shopping preferences, or could just create a short-lived migration from existing channels. The steady-state impact of a given entry or channel addition on various marketing metrics is intrinsically an empirical issue for which we need an appropriate testing procedure. In this study, we introduce a testing sequence that allows for the endogenous determination of potential change (break) locations, thereby accounting for lead and/or lagged effects of the introduction of interest. By not restricting the number of potential breaks to one (as is commonly done in the marketing literature), we quantify the impact of the newentrant(s) while controlling for other events that may have taken place in themarket. We illustrate the methodology in the context of the Dutch television advertising market, which was characterized by the entry of several latemovers.We findthat the steady-state growth of private incumbents' revenues was slowed by the quasi-simultaneous entry of three new players. Contrary to industry observers' expectations, such a slowdown was not experienced in the related markets of print and radio advertising
Sustained spending and persistent response: a new look at long-term marketing profitability.
Full text linkAn intuitively appealing decision rule is to allocate a company's scarce marketing resources where they have the greatest long-term benefit. This principle, however, is easier to accept than it is to execute, because long-run effects of marketing spending are difficult to estimate. We address this problem by examining the over-time behavior of market response and marketing spending, and identify four commonly occurring strategic scenarios: business as usual, hysteresis in response, escalating expenditures and evolving-business practice. We explain and illustrate why each scenario can occur in practice, and describe its positive and negative consequences for long-term profitability.When good time-series data on revenue and marketing spending are available, it is possible to apply multivariate persistence measures to identify which of the four strategic scenarios is taking place. We apply these ideas to data from two major companies in the packaged-foods and pharmaceuticals industries. We observe several long-term marketing effect, some with profitable and some with unprofitable consequences, and offer recommendations for each case.We conclude that high-quality databases along with modern time-series methods can be instrumental in extracting vital long-term marketing-effectiveness information from readily available data. Therefore, managing marketing resources with long-run performance in mind need no longer be a pure act of faith on behalf of the executive. We hope that this and future work will contribute toward an improved allocation of scarce marketing resources in our companies.Marketing; Profitability;
The European consumer: United in diversity?.
Full text linkThe ongoing unification which takes place on the European political scene, along with recent advances in consumer mobility and communication technology, raises the question whether the European Union can be treated as a single market to fully exploit the potential synergy effects from pan-European marketing strategies. Previous research, which mostly used domain-specific segmentation bases, has resulted in mixed conclusions. In this paper, a more general segmentation base is adopted, as we consider the homogeneity in the European countries' Consumer Confidence Indicators. Moreover, rather than analyzing more traditional static similarity measures, we adopt the concepts of dynamic correlation and cohesion between countries. The short-run fluctuations in consumer confidence are found to be largely country specific. However, a myopic focus on these fluctuations may inspire management to adopt multi-country strategies, foregoing the potential longer-run benefits from more standardized marketing strategies. Indeed, the Consumer Confidence Indicators become much more homogeneous as the planning horizon is extended. However, this homogeneity is found to remain inversely related to the cultural, economic and geographic distances among the various Member States. Hence, pan-regional rather pan-European strategies are called for.Communication; Consumer confidence; Country; Dynamic correlation; Effects; European unification; European Union; Indicators; Management; Market; Marketing; Planning; Research; Similarity; Strategy; Technology;
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