ADVERTISING'S EFFECT ON THE PRODUCT EVOLUTIONARY CYCLE

Susan L. Holak and Y. Edwin Tang

No 259454, Department of Economics and Business - Archive from North Carolina State University, Department of Economics

Abstract: Criticism of the product life cycle (PLC) concept concerns problems with theory, empirical validation, and practical use. It has been suggested that the product evolutionary cycle (PEC), an alternative concept based on the field of biology, provides a more complete picture of marketing mix effects and competition on product sales (Tellis and Crawford 1981 ). In this research, the U.S. cigarette industry is used as the arena in which to assess empirically the PEC framework. Advertising-sales causation is tested on three levels of segment competition: (1) individual brand (2) intracategory, and (3) intercategory competition. Our findings indicate that more distantly related "organisms" compete as well as those closely related in terms of background. Specifically, we demonstrate a gradual but marked decrease in the effect of advertising on sales as products with more distant lineage co-exist and compete. The PEC is demonstrated to be an information-laden framework to use in making marketing mix decisions.

Keywords: Marketing; Research Methods/Statistical Methods (search for similar items in EconPapers)
Pages: 42
Date: 1990-02-01
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:ncbuar:259454

DOI: 10.22004/ag.econ.259454

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