Managing across substitute categories : How to allocate marketing resources under changing competitive intensity?
Type
conference paper
Date Issued
2009-06-04
Author(s)
Keller, Jens
;
Pauwels, Koen
Abstract
Both changing competitive intensity and the pharmaceutical industry have become important research topics in economics and marketing. While the economics literature has started to consider the fortunes of generic drug manufacturers, the marketing literature has remained focused on how brand name drug manufacturers should respond to entry and competition from other brand name drugs and from generics. No paper has looked at the marketing actions and their effectiveness for both brand name and generic drug manufacturers. Moreover, research has considered competition and marketing spending within one chemical compound or for a therapeutic class as a whole, instead of distinguishing within-compound from across-compound competition, i.e. among drugs targeting the same therapeutic class with objectively different compounds. This is particularly important for marketing spending allocation because many large brand name and generic drug manufacturers produce several compounds for the same therapeutic class, and thus face a choice of entry strategies and marketing allocation across compounds. Our study uses a Dynamic Linear Model to investigate price response and marketing effectiveness of brand name and generic drug manufacturers. We analyze within-compound and across-compound behavior by incorporating 6 major compound-submarkets of the total antidepressant market.
Language
English
HSG Classification
contribution to scientific community
Refereed
No
Start page
2
Event Title
31st INFORMS Marketing Science Conference 2009
Event Location
Ann Arbor, Michigan
Event Date
04.-06.06.2009
Subject(s)
Division(s)
Eprints ID
53715