Endogenous Modeling of Late Entry Penalties for Packaged Goods Classic Reprint

This book explores the concept of late entry penalties for packaged goods, analyzing the innate market share advantage enjoyed by early entrants. The author extends previous research by examining the endogenous effects of order of entry on marketing variables and the decision to enter early. Through a recursive structural equation model, the book investigates how order of entry influences promotion, price, distribution, and advertising levels. It also examines the relationship between entry order and expected market share, as well as firm size and performance. The author finds that late entrants systematically have lower levels of marketing efforts and higher prices, but these effects do not eliminate the innate market share penalty for late entry. The book concludes that there is an underlying market-generated penalty for late entry, even when considering the endogenous effects of order of entry on marketing variables and firm characteristics. This book provides valuable insights into the dynamics of market entry and the challenges faced by late entrants. It offers a comprehensive analysis of the factors that influence market share advantages and late entry penalties, making it essential reading for marketers, business strategists, and researchers interested in understanding the competitive landscape of packaged goods industries.