Wernerfelt, Birger
June 1994
Marketing Science;Summer94, Vol. 13 Issue 3, p298
Academic Journal
The paper offers a comparative analysis of different ways to sell products (selling formats) when buyers incur evaluation costs Since these costs are sunk at the moment of trade, buyers may refrain from incurring them for fear of later opportunism on the part of sellers. It is found that the use of many common selling formats can be explained in terms of their ability to alleviate this problem. Specifically, I explain price advertising, seller colocation, and bargaining. The theory explains much of the divergence in retail trading institutions and leads to several testable predictions. (Game Theory; Retailing; Advertising)


Related Articles

  • Media Exposure Patterns of Consumer Innovators. Summers, John O. // Journal of Marketing;Jan1972, Vol. 36 Issue 1, p43 

    While it may be appropriate, during the introduction of a new product, to include a broad promotional program designed to create product awareness in the market as a whole, the major thrust of the initial promotion should be the prompt development of an active group of satisfied early buyers....

  • Advertainment. G., Scott // Sales & Service Excellence Essentials;Dec2005, Vol. 5 Issue 12, p10 

    The article considers the use of advertising and entertainment in promoting products. Advertainment or integrating advertising and entertainment is manifested in many ways. To implement advertainment smoothly, the trick is to achieve the right match between audience and message. Another trick...

  • A Business Guide to Niche Picking. Mackay, Harvey // Sales & Service Excellence Essentials;Dec2005, Vol. 5 Issue 12, p10 

    The article discusses myths in selecting niche markets to sell products. First, a niche has to be chic. Second, a niche has to be new. Third, a niche should not be too narrow. Fourth, a niche has to be neat.

  • Les caractéristiques des champions : déterminants et incidence sur le succès des innovations. Roure, Lionel // Recherche et Applications en Marketing (AFM c/o ESCP-EAP);2000, Vol. 15 Issue 2, p3 

    This work introduces two new variables for understanding product championing : the seniority and the hierarchical level. This research used a sample of 121 innovation projects. The results demonstrate that the hierarchical level is positively correlated to the size of innovation projects and the...

  • Paul Seligman. Seligman, Paul // Campaign;3/28/2003, Issue 13, The Direct Approach. p11 

    Fast moving consumer goods (FMCG) brand marketers have historically struggled to see a role for direct marketing (DM) in their communications mix. Most have little experience of DM and believe that it is best used on cars, holidays and financial products. The success of Tesco Clubcard has...

  • INCOMPLETE INFORMATION BARGAINING WITH OUTSIDE OPPORTUNITIES. Fudenberg, Drew; Levine, David K.; Tirole, Jean // Quarterly Journal of Economics;Feb87, Vol. 102 Issue 1, p37 

    We consider two kinds of ‘outside opportunity’ that a seller of an indivisible good might have: selling to a different buyer and consuming the good herself. In both models the seller is uncertain about the buyer's valuation, and becomes more pessimistic over time. When the seller...

  • More than just a box.  // Smart Business Pittsburgh;Nov2008, Vol. 15 Issue 7, p17 

    The article provides information on the relevance of using innovative packaging in marketing commercial products. Packaging accordingly plays essential role in advertisement, more particularly that it goes beyond the container itself for consumers identify products in accordance to their first...

  • Advertising's Crisis of Confidence. Jones, John Philip // Marketing Management;1993, Vol. 2 Issue 1, p14 

    Advertising is stagnating and its effectiveness is decreasing. Manufacturers need to improve the sales-generating efficiency of advertising to compensate for the flattening or decline in the advertising budgets of so many brands. But, even though circumstances call for advertising productivity...

  • RESEARCH IN MARKETING. Lorie, James H. // Journal of Marketing;Jul1951, Vol. 16 Issue 1, p83 

    The article reports on research projects that have been completed, or that are underway, which pertain to the field of marketing. The author includes information about research studies that focus on topics including industrial marketing, producers' marketing of commercial products, and foreign...


Read the Article


Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics