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Article
The Impact of low-price brands on the order of entry advantage
Journal of Marketing Management (2012)
  • Dean C.H. Wilkie, University of New South Wales
  • Lester Johnson, Melbourne Business School
  • Lesley White, Charles Sturt University
Abstract

The objectives of this research are to investigate (1) if a later entrant can reduce an order of entry effect by positioning itself as a low-price brand; and (2) if the type of low-price brand impacts the effectiveness of this strategy. The impact of a low-price strategy on the order of entry effect has been modelled using three categories of over-the-counter medicines. The results indicate that, in a majority of categories and dependent on the type of low-price brand, a low-price strategy can reduce the market share penalty for being a later entrant. In addition, the results provide evidence that leveraging an existing store brand name does not provide a strategic advantage over establishing a new brand name. The implications for managers is that a low-price brand provides a motivating point of difference for consumers, which shifts brand preferences and market share away from the pioneer brand.

Keywords
  • order of entry effect; low-price brands; OTC medicines
Disciplines
Publication Date
July, 2012
Citation Information
Dean C.H. Wilkie, Lester Johnson and Lesley White. "The Impact of low-price brands on the order of entry advantage" Journal of Marketing Management Vol. 28 Iss. 7-8 (2012)
Available at: http://works.bepress.com/lester_johnson/6/