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Sudharshan, Devanathan Gruca, Thomas 2011-05-07T12:24:25Z 2011-05-07T12:24:25Z 10000-01-01 1989 An important problem in marketing that has received little attention is the reaction to entry of new brands by incumbent firms. In this thesis, the marketing mix reaction to entry under different managerial objectives is studied though the formulation of a marketing interaction model and the estimation of the model from empirical data. A market interaction model is developed from previous empirical research. This model of segment-level brand choice incorporates joint-space modeling of product positions and consumer ideal points, market segmentation and response function modeling of advertising and distribution expenditures into a market share attraction formulation. This model is used to develop the objective functions faced by managers who are assumed to pursue one of three goals: market share, sales revenue or profit maximization. The Nash equilibrium solution to an N-person game using the managerial objective functions as payoff functions is shown to exist. The before and after entry Nash equilibrium strategies can be computed for all brands. Any change in the marketing mix (price, advertising and distribution expenditures) of a brand with the introduction of a new brand is assumed to be the optimal response to entry under the given managerial objective. The entry of a new brand of ground coffee into two retail markets served as the empirical application of the model. The market interaction model and managerial objective functions were estimated from empirical sources including scanner panel data. The expected marketing mix for each brand was computed for the before and after entry periods under three managerial objectives. The predicted changes in the marketing mix of each brand were compared to the changes observed in the marketplace. It was found in the two markets studied that the objective which best captures actual reaction to entry is sales revenue maximization. The model developed in this research can represent a wide range of consumer choice behavior and can be estimated from readily attainable data and methodologies. The managerial model allows for varying managerial objectives. This research provides a firmer foundation upon which to base future work toward understanding competitive marketing strategy. Made available in DSpace on 2011-05-07T12:24:25Z (GMT). No. of bitstreams: 2 license.txt: 4922 bytes, checksum: 910b249b4beec47e7ab768910c8f966f (MD5) 8924827.pdf: 9419647 bytes, checksum: c090cbc0d0da311b6b8b8156da3941f6 (MD5) Previous issue date: 1989 Item marked as restricted to the 'UIUC Users [automated]' Group (id=2) by Howard Ding (hding2@illinois.edu) on 2011-05-07T14:40:38Z Item is restricted indefinitely. Restriction data tranferred 2014-07-01T11:17:27-05:00 Original Data Group with Access UIUC Users [automated] Release Date: none Reason: ETDs are only available to UIUC Users without author permission ETDs are only available to UIUC Users without author permission U of I Only AAI8924827 (UMI)AAI8924827 http://hdl.handle.net/2142/19966 eng Copyright 1989 Gruca, Thomas Stanley Business Administration, Marketing Optimal competitive marketing response to entry: Theoretical and empirical analyses text Business Administration Business Administration University of Illinois at Urbana-Champaign Dissertation Ph.D.