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A Factor Analysis Approach to Measure the Biased Effects of Retail Fruit Juice Advertising

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  • Gao, X M
  • Lee, Jonq-Ying

Abstract

This study presents a structural factor analysis approach to measure the impact of advertising on consumer demand. It is assumed that advertising affects the latent perception of consumers, which in turn influences their purchasing behavior. This study investigates the relationship between consumer purchases and retail store advertising (i.e., newspaper advertising, in-store display, and point-of-purchase display) of three fruit juices using an extended Rotterdam model. The results show that the demand for orange juice and grapefruit juice was affected by their own advertising, while the demand for apple juice was only affected by advertising of competitive juices.

Suggested Citation

  • Gao, X M & Lee, Jonq-Ying, 1995. "A Factor Analysis Approach to Measure the Biased Effects of Retail Fruit Juice Advertising," Empirical Economics, Springer, vol. 20(1), pages 93-107.
    • Handle: RePEc:spr:empeco:v:20:y:1995:i:1:p:93-107
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    Cited by:

    1. Xun Li & Rigoberto A. Lopez, 2015. "Do Brand Advertising Spillovers Matter?," Agribusiness, John Wiley & Sons, Ltd., vol. 31(2), pages 229-242, April.
    2. Zheng, Yuqing & Kaiser, Harry M., 2008. "Advertising and U. S. Nonalcoholic Beverage Demand," Agricultural and Resource Economics Review, Cambridge University Press, vol. 37(2), pages 147-159, October.

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