<form name="aspnetForm" method="post" action="measuring-consumer-and-competitive-impact-with-elasticity-decompositions?item=measuring-consumer-and-competitive-impact-with-elasticity-decompositions" id="aspnetForm">
<input type="hidden" name="MSOWebPartPage_PostbackSource" id="MSOWebPartPage_PostbackSource" value="" />
<input type="hidden" name="MSOTlPn_SelectedWpId" id="MSOTlPn_SelectedWpId" value="" />
<input type="hidden" name="MSOTlPn_View" id="MSOTlPn_View" value="0" />
<input type="hidden" name="MSOTlPn_ShowSettings" id="MSOTlPn_ShowSettings" value="False" />
<input type="hidden" name="MSOGallery_SelectedLibrary" id="MSOGallery_SelectedLibrary" value="" />
<input type="hidden" name="MSOGallery_FilterString" id="MSOGallery_FilterString" value="" />
<input type="hidden" name="MSOTlPn_Button" id="MSOTlPn_Button" value="none" />
<input type="hidden" name="__REQUESTDIGEST" id="__REQUESTDIGEST" value="0x0B4AC5EE90497366813A8E02A5537712C8F0AB8F9932893809ADAE07EDF92EB3FE56EA1DA8DD1BB9F99D40E61811FCE346EF39A2BE979E549B7403A82ABEA8B3,18 Jun 2019 06:06:28 -0000" />
<input type="hidden" name="MSOSPWebPartManager_DisplayModeName" id="MSOSPWebPartManager_DisplayModeName" value="Browse" />
<input type="hidden" name="MSOSPWebPartManager_ExitingDesignMode" id="MSOSPWebPartManager_ExitingDesignMode" value="false" />
<input type="hidden" name="MSOWebPartPage_Shared" id="MSOWebPartPage_Shared" value="" />
<input type="hidden" name="MSOLayout_LayoutChanges" id="MSOLayout_LayoutChanges" value="" />
<input type="hidden" name="MSOLayout_InDesignMode" id="MSOLayout_InDesignMode" value="" />
<input type="hidden" name="MSOSPWebPartManager_OldDisplayModeName" id="MSOSPWebPartManager_OldDisplayModeName" value="Browse" />
<input type="hidden" name="MSOSPWebPartManager_StartWebPartEditingName" id="MSOSPWebPartManager_StartWebPartEditingName" value="false" />
<input type="hidden" name="MSOSPWebPartManager_EndWebPartEditing" id="MSOSPWebPartManager_EndWebPartEditing" value="false" />
<input type="hidden" name="__VIEWSTATE" id="__VIEWSTATE" value="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" />

<script type="text/javascript">
//<![CDATA[
var MSOWebPartPageFormName = 'aspnetForm';
var g_presenceEnabled = true;var _fV4UI=true;var _spPageContextInfo = {webServerRelativeUrl: "\u002f", webLanguage: 1033, currentLanguage: 1033, webUIVersion:4,pageListId:"{229a3fa1-d23f-4194-af04-83f712f16168}",pageItemId:24, alertsEnabled:true, siteServerRelativeUrl: "\u002f", allowSilverlightPrompt:'True'};//]]>
</script>
<script type="text/javascript" src="/_layouts/1033/init.js?rev=0OHTJmtljdkrRniX3Vao7A%3D%3D"></script>
<script src="/WebResource.axd?d=KzYTxvKcuTEp7j51joTea5GVr92AuJ4SL5aQ9QUnLuUrG7rTi8YCbgNYedMwdv6fDwv5Ou7X64HliGCav7hiwmuBylh2hjGhv6JU0lkokc63lAPUBD0MIaMGwGty9ueA82idlgs7ktVQj8-X5TCDW8nNPkA1&t=636767462854137053" type="text/javascript"></script>
<script type="text/javascript">
//<![CDATA[
var dlc_fvsi = {"DefaultViews":[],"ViewUrls":[],"WebUrl":"\/"};//]]>
</script>

<script type="text/javascript">
//<![CDATA[
function _spNavigateHierarchy(nodeDiv, dataSourceId, dataPath, url, listInContext, type) {
    CoreInvoke('ProcessDefaultNavigateHierarchy', nodeDiv, dataSourceId, dataPath, url, listInContext, type, document.forms.aspnetForm, "", "\u002fitem\u002fmeasuring-consumer-and-competitive-impact-with-elasticity-decompositions");

}
//]]>
</script>
<input type="hidden" name="__VIEWSTATEGENERATOR" id="__VIEWSTATEGENERATOR" value="7BAFC84E" />
<script type="text/javascript">RegisterSod("sp.core.js", "\u002f_layouts\u002fsp.core.js?rev=7ByNlH\u00252BvcgRJg\u00252BRCctdC0w\u00253D\u00253D");</script><script type="text/javascript">RegisterSod("sp.res.resx", "\u002f_layouts\u002fScriptResx.ashx?culture=en\u00252Dus\u0026name=SP\u00252ERes\u0026rev=b6\u00252FcRx1a6orhAQ\u00252FcF\u00252B0ytQ\u00253D\u00253D");</script><script type="text/javascript">RegisterSod("sp.ui.dialog.js", "\u002f_layouts\u002fsp.ui.dialog.js?rev=Tpcmo1\u00252FSu6R0yewHowDl5g\u00253D\u00253D");RegisterSodDep("sp.ui.dialog.js", "sp.core.js");RegisterSodDep("sp.ui.dialog.js", "sp.res.resx");</script><script type="text/javascript">RegisterSod("core.js", "\u002f_layouts\u002f1033\u002fcore.js?rev=Emb5hNX1RZMNXk9oS82yvA\u00253D\u00253D");</script>
<script type="text/javascript">
//<![CDATA[
var _spFormDigestRefreshInterval = 1440000;window.g_updateFormDigestPageLoaded = new Date(); window.g_updateFormDigestPageLoaded.setDate(window.g_updateFormDigestPageLoaded.getDate() -5);function loadMDN2() { EnsureScript('MDN.js', typeof(loadFilterFn), null); }
function loadMDN1() { ExecuteOrDelayUntilScriptLoaded(loadMDN2, 'sp.ribbon.js'); }
_spBodyOnLoadFunctionNames.push('loadMDN1');//]]>
</script>
<script type="text/javascript">RegisterSod("sp.runtime.js", "\u002f_layouts\u002fsp.runtime.js?rev=IGffcZfunndj0247nOxKVg\u00253D\u00253D");RegisterSodDep("sp.runtime.js", "sp.core.js");RegisterSodDep("sp.runtime.js", "sp.res.resx");</script><script type="text/javascript">RegisterSod("sp.js", "\u002f_layouts\u002fsp.js?rev=\u00252B4ZEyA892P3T0504qi0paw\u00253D\u00253D");RegisterSodDep("sp.js", "sp.core.js");RegisterSodDep("sp.js", "sp.runtime.js");RegisterSodDep("sp.js", "sp.ui.dialog.js");RegisterSodDep("sp.js", "sp.res.resx");</script><script type="text/javascript">RegisterSod("cui.js", "\u002f_layouts\u002fcui.js?rev=OOyJv78CADNBeet\u00252FvTvniQ\u00253D\u00253D");</script><script type="text/javascript">RegisterSod("inplview", "\u002f_layouts\u002finplview.js?rev=WB6Gy8a027aeNCq7koVCUg\u00253D\u00253D");RegisterSodDep("inplview", "core.js");RegisterSodDep("inplview", "sp.js");</script><script type="text/javascript">RegisterSod("ribbon", "\u002f_layouts\u002fsp.ribbon.js?rev=F\u00252BUEJ66rbXzSvpf7nN69wQ\u00253D\u00253D");RegisterSodDep("ribbon", "core.js");RegisterSodDep("ribbon", "sp.core.js");RegisterSodDep("ribbon", "sp.js");RegisterSodDep("ribbon", "cui.js");RegisterSodDep("ribbon", "sp.res.resx");RegisterSodDep("ribbon", "sp.runtime.js");RegisterSodDep("ribbon", "inplview");</script><script type="text/javascript">RegisterSod("sp.ui.policy.resources.resx", "\u002f_layouts\u002fScriptResx.ashx?culture=en\u00252Dus\u0026name=SP\u00252EUI\u00252EPolicy\u00252EResources\u0026rev=YhBHGmUAGyJ3lAgSdE4V\u00252Fw\u00253D\u00253D");</script><script type="text/javascript">RegisterSod("mdn.js", "\u002f_layouts\u002fmdn.js?rev=gwmFFJ2\u00252FfFacqXWAqG\u00252FqKg\u00253D\u00253D");RegisterSodDep("mdn.js", "sp.core.js");RegisterSodDep("mdn.js", "sp.runtime.js");RegisterSodDep("mdn.js", "sp.js");RegisterSodDep("mdn.js", "cui.js");RegisterSodDep("mdn.js", "ribbon");RegisterSodDep("mdn.js", "sp.ui.policy.resources.resx");</script>
<script type="text/javascript">
//<![CDATA[

function _spNavigateHierarchyEx(nodeDiv, dataSourceId, dataPath, url, listInContext, type, additionalQString) {
    SetAdditionalNavigateHierarchyQString(additionalQString);
    g_originalSPNavigateFunc(nodeDiv, dataSourceId, dataPath, url, listInContext, type);
}

g_originalSPNavigateFunc = _spNavigateHierarchy;
_spNavigateHierarchy = _spNavigateHierarchyEx;
var _fV4UI = true;//]]>
</script>
<script type="text/javascript">RegisterSod("msstring.js", "\u002f_layouts\u002f1033\u002fmsstring.js?rev=QtiIcPH3HV7LgVSO7vONFg\u00253D\u00253D");</script><script type="text/javascript">RegisterSod("browserScript", "\u002f_layouts\u002f1033\u002fnon_ie.js?rev=EVTj1bu32\u00252FMla6SDN\u00252FsNTA\u00253D\u00253D");</script>
<script type="text/javascript">
//<![CDATA[
var __wpmExportWarning='This Web Part Page has been personalized. As a result, one or more Web Part properties may contain confidential information. Make sure the properties contain information that is safe for others to read. After exporting this Web Part, view properties in the Web Part description file (.WebPart) by using a text editor such as Microsoft Notepad.';var __wpmCloseProviderWarning='You are about to close this Web Part.  It is currently providing data to other Web Parts, and these connections will be deleted if this Web Part is closed.  To close this Web Part, click OK.  To keep this Web Part, click Cancel.';var __wpmDeleteWarning='You are about to permanently delete this Web Part.  Are you sure you want to do this?  To delete this Web Part, click OK.  To keep this Web Part, click Cancel.';//]]>
</script>
</form>

Skip to Main Content

05 Jul 2006Working Paper Summaries

Measuring Consumer and Competitive Impact with Elasticity Decompositions

by Thomas J. Steenburgh

Do marketing actions expand the market or steal business from rival firms? One research method suggests that all of the demand created by an incremental advertising investment would be generated by market expansion; another suggests that the same increase would be stolen from rival firms. Steenburgh explains why these seemingly contradictory results actually are complementary and provide a more comprehensive understanding of the investment's impact. Key concepts include:

Combine the consumer and the competitive points of view for a more complete understanding of the marketing investment's impact.

Author Abstract

In this article, I discuss three methods of decomposing the elasticity of own-good demand. One of the methods, the decision-based decomposition (Gupta, 1988), is useful in determining the influence of changes in consumers' decisions on the growth in owngood demand. The other two methods, the unit-based decomposition (van Heerde et al., 2003) and the share-based decomposition (Berndt et al., 1997), are useful in determining whether the growth in own-good demand has been stolen from competing goods. The objective of this article is to provide a clear and accurate method that attributes the growth in own-good demand to changes in: (1) consumers' decisions, (2) competitive demand, and (3) competitive market share. I will accomplish this by settling some confusion about what the decision- and share-based decompositions mean, by discussing how each of the decompositions relate to the others, and by discussing the research questions that each of the decompositions can answer.

Paper Information

Full Working Paper Text
Working Paper Publication Date: May 2005, revised February 2006
HBS Working Paper Number: 05-074
Faculty Unit(s): Marketing

Trending

- 28 Jan 2019
- Research & Ideas
Forget Cash. Here Are Better Ways to Motivate Employees
- 11 Jun 2019
- Book
These Aren't Beach Books, but Managers Should Read Them Anyway
- 22 Nov 2010
- Research & Ideas
Seven Strategy Questions: A Simple Approach for Better Execution
- 07 Jun 2019
- Book
Are You a Digital Manager?
- 21 Mar 2019
- HBS Case
The Ferrari Way

Find Related Articles

Sign up for our weekly newsletter

Interested in improving your business? Learn about fresh research and ideas from Harvard Business School faculty.