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ANALYZING VARIATIONS IN ADVERTISING AND PROMOTIONAL EXPENDITURES: KEY CORRELATES IN CONSUMER, INDUSTRIAL, AND SERVICE MARKETS
by Siva K. Balasubramanian and V. Kumar
The authors extend prior research on explaining variations in the intensity of marketing communication (i.e., advertising and promotional expenditures/sales) with a simple model estimated on cross-sectional time-series data. Analyses on firm-level data pooled at the industry level, performed for each of several industries belonging to different markets, attest to the model's explanatory power. Model validation analyses show an impressive similarity of model parameters and goodness of fit across split-half data samples for each industry analyzed. Further, for all industries belonging to a given market, the results indicate remarkable consistency in the signs of the associations between marketing communication intensity and (1) market share, (2) market growth, and (3) their interaction. However, this consistency does not hold across all markets. Plausible explanations for these results are advanced.
The Journal of Marketing, Vol. 54, No. 2 (Apr., 1990), pp. 57-68
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