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Fabian Bergès and Sylvette Monier-Dilhan
''Mass Retailers' Advertising Strategies Against Commodity Stores.''
( 2013, Vol. 33 No.4 )
A retailer has different opportunities to advertise in the media: emphasizing the store image or promoting specifically its private label (PL). In the first option, advertising benefits all products sold, whereas in the alternative, only store brands are concerned by image improvement. We analyze the retailer's advertising campaign strategies when its competitor's format is a small commodity store. PL quality is endogenous and chosen according to the competitor's product range. We show the retailer prefers to advertise the store rather than its PL. However, this strategy may push commodity stores out of the market and reduce social welfare.
Keywords: Advertising, Retailing, Competition.
JEL: L1 - Market Structure, Firm Strategy, and Market Performance: General
M3 - Marketing and Advertising: General
Manuscript Received : Jul 23 2013 Manuscript Accepted : Dec 23 2013

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