PROMOTIONAL ELASTICITIES AND CATEGORY CHARACTERISTICS

The authors study the relationships between product category character istics and average brand promotional elasticity within the category. T hey present a framework for understanding these relationships and use it to generate hypotheses. The authors also consider three types of pr omotions and seven category characteristics. They study 108 product ca tegories and use data compiled from weekly scanner data, scanner panel data, and survey data. Their results indicate that promotional elasti cities are higher for categories with relatively fewer number of brand s, higher category penetration, shorter interpurchase times, and highe r consumer propensity to stockpile. The authors find no statistically significant relationship between promotional elasticity and either imp ulse buying or private label market share. They discuss the reasons fo r these results and their managerial implications.