MANAGEMENT SLANT
- Direct-to-consumer advertising tends to be effective in stimulating drug-category sales in pharmaceutical markets, where leader–follower pricing behavior exists.
- Under certain conditions, an integrated advertising and pricing strategy can be profitable for all companies in a market. The strategy involves category-expanding advertising by a company, combined with a competitive pricing strategy.
- The prescription-drug brand that spends most on consumer advertising should be the price leader.
- Advertising and pricing strategies complement each other: An effective advertising campaign is necessary for the pricing strategy to work, and a profitable leader–follower pricing system justifies the expenditure...