Information Gathering and Marketing

27 Pages Posted: 17 May 2010

See all articles by Heski Bar-Isaac

Heski Bar-Isaac

University of Toronto - Rotman School of Management

Guillermo Caruana

Centre for Monetary and Financial Studies (CEMFI)

Vicente Cuñat

London School of Economics & Political Science (LSE) - Financial Markets Group

Multiple version iconThere are 3 versions of this paper

Date Written: May 2010

Abstract

Consumers have only partial knowledge before making a purchase decision, but can acquire more-detailed information. Marketing makes it easier or harder for these consumers to do so. When consumers are ex ante heterogeneous, the firm might choose an intermediate marketing strategy for two quite different reasons. First, as a nonprice means of discrimination, it can make information only partially available, in a way that induces some, but not all, consumers to acquire the information. Second, when the firm cannot commit to a given investment in ensuring quality, the marketing and pricing strategy can act as a commitment device.

Note: Added submission date (NEG 5/28/10).

Suggested Citation

Bar-Isaac, Heski and Caruana, Guillermo and Cuñat, Vicente, Information Gathering and Marketing (May 2010). Journal of Economics & Management Strategy, Vol. 19, Issue 2, pp. 375-401, Summer 2010. Available at SSRN: https://ssrn.com/abstract=1608072 or http://dx.doi.org/10.1111/j.1530-9134.2010.00255.x

Heski Bar-Isaac (Contact Author)

University of Toronto - Rotman School of Management ( email )

105 St. George Street
Toronto, Ontario M5S 3E6 M5S1S4
Canada
416 978 3626 (Phone)

HOME PAGE: http://https://sites.google.com/site/heskibarisaac/home

Guillermo Caruana

Centre for Monetary and Financial Studies (CEMFI) ( email )

Casado del Alisal 5
28014 Madrid
Spain
34 91 429 0551 (Phone)
34 91 429 1056 (Fax)

Vicente Cuñat

London School of Economics & Political Science (LSE) - Financial Markets Group ( email )

Houghton Street
London WC2A 2AE
United Kingdom

HOME PAGE: http://www.vicentecunat.com

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