Riding the Waves: Revealing the Impact of Intrayear Category Demand Cycles on Advertising and Pricing Effectiveness

Going beyond traditional seasonality, this research introduces the concept of the intrayear category demand cycle. This phenomenon reflects demand cycles most consumer packaged goods categories experience throughout the year, with periods of higher demand following periods of lower demand. The author argues that acknowledging the existence of these cycles and understanding their impact on both advertising and pricing effectiveness and practice is critical for marketers. Specifically, the author demonstrates how both advertising and price elasticities and observed advertising and prices evolve along these cycles for a unique set of 252 brands—ranging from high-advertising, high-priced “premium mass” brands to low-advertising, low-priced “value niche” brands—in 61 consumer packaged goods categories. Overall, both advertising efectiveness and observed advertising are found to be stronger at demand peaks. Surprisingly, consumer reactions to price decreases are weaker at demand peaks, whereas reactions to price increases remain unchanged. However, effectiveness evolutions and observed action patterns along these intrayear cycles are both markedly diverse across the different types of brands.

• 저널Journal of Marketing Research · 54(2) · 171–186
• 토픽Consumer Market Behavior and Pricing · Marketing
• DOI10.1509/jmr.14.0576
• 저자Maarten J. Gijsenberg