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To link to full-text access for this article, visit this link: http://dx.doi.org/10.1016/j.ijresmar.2005.09.008 Byline: David A. Soberman, Philip M. Parker Keywords: Retailing; Store brand; Private labels; Retailer brand; National brand; Price discrimination Abstract: A key change in the retail environment over the last 20 years has been the emergence and growth of low priced quality-equivalent store brands. National brand manufacturers with popular products seem to help retailers by supplying them with quality-equivalent store brands that are then sold for lower prices. Nevertheless, empirical research has found that this phenomenon often leads to higher average category prices. We explain this apparent contradiction using a model where a national brand manufacturer supports its product with advertising and the retailer may introduce a store brand to better serve its customers. Our analysis shows that when both the manufacturer and the retailer have market power, the launch of a quality-equivalent store brand by the retailer can lead to higher average category prices. Rather than leading to what some call 'private label competition', both the manufacturer and the retailer benefit with the launch of quality-equivalent store brands. As a result, even a dominant manufacturer has an incentive to agree to a retailer's request to supply a quality-equivalent store brand. Author Affiliation: INSEAD, Fontainebleau Cedex, 77305, France

Several aspects of store brand marketing are investigated and changes in aggregate market prices often accompanying increased store brand activity are analyzed, using a model which illustrates that a launch of a quality-equivalent store brand by a retailer stimulates higher advertising by the manufacturer. Analysis indicates that business reports of competition between store brands and national brands might be exaggerated, and the manufacturer often supplies a quality-equivalent store brand to a retailer.

Byline: Barbara Deleersnyder (1), Marnik G. Dekimpe (2,3), Miklos Sarvary (4), Philip M. Parker (5) Keywords: business cycles; sales evolution; consumer durables; time-series econometrics Abstract: Despite their obvious importance, not much marketing research focuses on how business-cycle fluctuations affect individual companies and/or industries. Often, one only has aggregate information on the state of the national economy, even though cyclical contractions and expansions need not have an equal impact on every industry, nor on all firms in that industry. Using recent time-series developments, we introduce various measures to quantify the extent and nature of business-cycle fluctuations in sales. Specifically, we discuss the concept of cyclical volatility, and derive a dynamic comovement elasticity between the economy as a whole and the cyclical fluctuations in various performance series. To further enhance our understanding of how consumers adjust their purchasing behavior across different phases of the business cycle, two other notable features related, respectively, to the relative size of the peaks and troughs and the rate of change in upward and downward parts of the cycle, are explicitly considered. Of specific interest in this respect are the notion of deepness and steepness asymmetry. We apply these concepts to a broad set (24) of consumer durables, for which we analyze the cyclical sensitivity in their sales evolution. In that way, we (i) derive a novel set of empirical generalizations, and (ii) test different marketing theory-based hypotheses on the underlying drivers of cyclical sensitivity. Consumer durables are found to be more sensitive to business-cycle fluctuations than the general economic activity, as expressed in an average cyclical volatility of more than four times the one in GNP, and an average dynamic comovement elasticity in excess of 2. This observation calls for an explicit consideration of cyclical variation in durable sales. Interestingly, the combined evidence across all durables suggests that asymmetry is present in the speed of up- and downward movements, as durable sales fall much quicker during contractions than they recover during economic expansions. Finally, key variables related to the industry's pricing activities, the nature of the durable (convenience vs. leisure), and the stage in a product's life cycle tend to moderate the extent of cyclical sensitivity in durable sales patterns. Author Affiliation: (1) Postdoc Researcher Fellow in Marketing, Erasmus University Rotterdam, P.O. Box 1738, 3000 DR, Rotterdam, The Netherlands (2) Professor of Marketing, Catholic University of Leuven, Naamsestraat 69, 3000 Leuven, Belgium (3) Professor of Marketing Management, Erasmus University Rotterdam, The Netherlands (4) Associate Professor of Marketing, INSEAD, Boulevard de Constance, 77305, Fontainebleau, France (5) The Eli Lilly Chaired Professor of Innovation, Business and Society, INSEAD, Boulevard de Constance, 77305, Fontainebleau, France Article History: Registration Date: 31/12/2004

A staged estimation procedure of determining diffusion of cellular telephone technology in the global market may explain how the technology was assimilated in the international market. The approach provides robust and sensible estimates with high reusability rates even at its earliest stages. The method is tested on data from 184 countries to determine exogenous and endogenous country characteristics.

An approach to helping managers develop broad strategic guidelines and precise pricing and budgetary policies prior to a product introduction is presented. The approach is called dynamic decision calculus which is a union of dynamic optimization and decision calculus calibration. The technique is centered around framing marketing problems in such a way that the impacts of life-cycle dynamics in a particular industry are readily apparent.

A game-theoretic model was developed to test concepts in marketing information. The model showed information to be treated as 'substitutes' when the market environment has several reliable and correlated sources, and as 'complements' when the environment has unreliable and uncorrelated sources. An environment with reliable and correlated sources makes for fierce competition that decreases the price of information while the opposite condition stabilizes the price of information.

The adoption of innovations by national economies is examined using cellular telephony as an example.

The pricing strategies of retailers, who sell both national brands and quality-equivalent private-labels, are analyzed. Also, the impact of advertising on the ability of retailers to increase profitability across all brands is examined. To measure the extent to which advertising increases, or reduces market power, a structural model of market behavior is developed. The model gauges the extent to which defensive advertising strategies by national brands influence competitive/collusive outcomes against/with private-label brands.