Advertising sunk costs and credible spatial preemption

• 成果类型: Article
• 署名作者: Thomas, LA
• 刊物名称: STRATEGIC MANAGEMENT JOURNAL
• ISSN/ISSBN: 0143-2095
• DOI: 10.1002/(SICI)1097-0266(199606)17:6<481::AID-SMJ824>3.0.CO;2-Q
• 发表日期: 1996
• 页码: 481-498
• 关键词: Advertising; preemption; sunk costs

摘要

Large sunk investments in advertising allow managers to credibly preempt potential entrants by introducing new products prior to anticipated increases in marker growth. Previous investment in advertising can lower a firm's cost to introduce new products allowing it to credibly preempt potential entrants. Entrants may not have enough residual share to find it profitable to enter later, and incumbents find it profitable to keep new products in the marker even if entrants choose to enter. I present empirical evidence from the RTE cereal industry.