Q: Is this strategy sensitive to advertisement?
A: Yes, in this case. I'll get a little more to this once I get to
the model stage. But I think you raised a good point.
What I'm going to be concentrating on is
pricing. As the first slide showed, there
are a lot of possibilities. You can think about the assortment
of products, the feature or promotional
strategies, or pricing strategies. Now,
this may not be totally satisfactory, but what I'd like to do is
concentrate on the pricing strategy, because it's one of
the most important variables under the retailer's control.
It's fairly well understood. We can go out and model it fairly
easily. It's something that is easy to differentiate
across the stores. So, in this case it would be difficult to
have different advertising strategies because sometimes this
advertisement is not going to just one store, it's
going to be seen by consumers that shop at 20 or 30 stores.
Advertisements typically go through the newspaper, although
that is changing.
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