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Push-Me Pull-You: Comparative Advertising in the OTC Analgesics Industry

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  • Anderson, Simon
  • Ciliberto, Federico
  • Liaukonyte, Jura
  • Renault, Regis

Abstract

We model comparative advertising as brands pushing up own brand perception and pulling down the brand image of targeted rivals. We watched all TV advertisements for OTC analgesics 2001-2005 to construct matrices of rival targeting and estimate the structural model. These attack matrices identify diversion ratios and hence comparative advertising damage measures. We find that outgoing comparative advertising attacks are half as powerful as self-promotion in raising own perceived quality and cause more damage to the targeted rival than benefit to the advertiser. Comparative advertising causes most damage through the pull-down effect and has substantial benefits to other rivals.

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  • Anderson, Simon & Ciliberto, Federico & Liaukonyte, Jura & Renault, Regis, 2012. "Push-Me Pull-You: Comparative Advertising in the OTC Analgesics Industry," MPRA Paper 38626, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:38626
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    1. Anderson, Simon & Ciliberto, Federico & Liaukonyte, Jura, 2010. "Getting into Your Head(Ache): The Information Content of Advertising in the Over-the-Counter Analgesics Industry," MPRA Paper 24916, University Library of Munich, Germany.
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    3. Yenipazarli, Arda, 2024. "Strategic incentives for comparative advertising investments in non-zero-sum competition and economic consequences," European Journal of Operational Research, Elsevier, vol. 312(3), pages 1059-1073.
    4. Griffith, Rachel & Dubois, Pierre & O'Connell, Martin, 2014. "The Effects of Banning Advertising on Demand, Supply and Welfare: Structural Estimation on a Junk Food Market," CEPR Discussion Papers 9942, C.E.P.R. Discussion Papers.
    5. Bart J. Bronnenberg & Jean-Pierre Dubé & Chad Syverson, 2022. "Marketing Investment and Intangible Brand Capital," Journal of Economic Perspectives, American Economic Association, vol. 36(3), pages 53-74, Summer.
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    7. Alipranti, Maria & Mitrokostas, Evangelos & Petrakis, Emmanuel, 2016. "Non-comparative and comparative advertising in oligopolistic markets," DICE Discussion Papers 231, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    8. Alexander E. Saak, 2012. "Dynamic Informative Advertising of New Experience Goods," Journal of Industrial Economics, Wiley Blackwell, vol. 60(1), pages 104-135, March.
    9. Anderson, Simon P. & Ciliberto, Federico & Liaukonyte, Jura, 2013. "Information content of advertising: Empirical evidence from the OTC analgesic industry," International Journal of Industrial Organization, Elsevier, vol. 31(5), pages 355-367.
    10. Maria Alipranti & Evangelos Mitrokostas & Emmanuel Petrakis, 2013. "Comparative versus Informative Advertising in Oligopolistic Markets," Working Papers 1301, University of Crete, Department of Economics.
    11. Cao, Sean Shun & Fang, Vivian W. & (Gillian) Lei, Lijun, 2021. "Negative peer disclosure," Journal of Financial Economics, Elsevier, vol. 140(3), pages 815-837.
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    15. Brett R. Gordon & Mitchell J. Lovett & Bowen Luo & James C. Reeder, 2023. "Disentangling the Effects of Ad Tone on Voter Turnout and Candidate Choice in Presidential Elections," Management Science, INFORMS, vol. 69(1), pages 220-243, January.
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    17. Maria Alipranti & Emmanuel Petrakis, 2013. "Comparative Advertising in Markets with Network Externalities," Working Papers 1306, University of Crete, Department of Economics.
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    19. Barton, Jared & Castillo, Marco & Petrie, Ragan, 2016. "Negative campaigning, fundraising, and voter turnout: A field experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 121(C), pages 99-113.
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    More about this item

    Keywords

    Comparative advertising; advertising targets; diversion ratios; attack matrix; push and pull effects; analgesics;
    All these keywords.

    JEL classification:

    • L65 - Industrial Organization - - Industry Studies: Manufacturing - - - Chemicals; Rubber; Drugs; Biotechnology; Plastics
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • M37 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Advertising

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