Abstract
The authors demonstrate that competition among brands in different quality tiers can be asymmetric both in brand choice (“what”) and in category choice (“whether”). They also investigate how competition among quality tiers is affected by the direction of price changes (increase or decrease). Empirical findings from four scanner panel data sets consistently show that with price reduction, high-quality brands gain more than do low-quality brands both in “what” and “whether” decisions. Furthermore, high-quality brands are less vulnerable to losses when prices are increased. The authors conclude with implications for understanding quality tier competition and developing price promotional strategies.
Keywords
Competition (biology)Quality (philosophy)Consumer choiceBusinessPanel dataEmpirical researchEconomicsMarketingAdvertisingMicroeconomicsEconometrics
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Publication Info
- Year
- 1997
- Type
- article
- Volume
- 61
- Issue
- 3
- Pages
- 71-84
- Citations
- 181
- Access
- Closed
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Cite This
K. Sivakumar,
S. P. Raj
(1997).
Quality Tier Competition: How Price Change Influences Brand Choice and Category Choice.
Journal of Marketing
, 61
(3)
, 71-84.
https://doi.org/10.1177/002224299706100305
Identifiers
- DOI
- 10.1177/002224299706100305