Valuing Brand Collaboration: Evidence From a Natural Experiment

50 Pages Posted: 7 Mar 2019 Last revised: 17 Aug 2020

See all articles by Yewon Kim

Yewon Kim

Stanford Graduate School of Business; University of Chicago, Booth School of Business

Sanjog Misra

University of Chicago - Booth School of Business

Bradley Shapiro

University of Chicago - Booth School of Business

Date Written: August 14, 2020

Abstract

We study complementarities between brands in the context of collaborations across museums. Over the course of our sample, one major museum with a highly recognized brand closed temporarily and sequentially collaborated with two established local museums. With individual panel data on museum memberships around these events, we measure how collaborations affect demand using an empirical framework of complementarities that are newly applied to the branding context. We observe two counter-acting demand patterns. First, customers with no history of buying membership from either museum enter the market, suggesting brand complementarities. Second, a sub-group of customers who previously purchased from either or both of the museums display decreased demand, consistent with brand dilution. Any structural approach that models the demand for collaboration with existing preferences for separate brands fails to create accurate demand predictions. The magnitude of the offsetting forces varies between collaboration events, which makes demand prediction even more challenging. These results call for a theory of brand being beyond a fixed utility primitive and have implications for counterfactuals that involve combining or altering of brands..

Keywords: Branding, Demand Estimation, Co-Branding, Brand Collaboration, Fine Arts

JEL Classification: L22, L24, L40, L82, M31, C53, C54

Suggested Citation

Kim, Yewon and Misra, Sanjog and Shapiro, Bradley, Valuing Brand Collaboration: Evidence From a Natural Experiment (August 14, 2020). Available at SSRN: https://ssrn.com/abstract=3335833 or http://dx.doi.org/10.2139/ssrn.3335833

Yewon Kim (Contact Author)

Stanford Graduate School of Business ( email )

University of Chicago, Booth School of Business ( email )

Chicago, IL
United States

Sanjog Misra

University of Chicago - Booth School of Business ( email )

5807 South Woodlawn Avenue
Chicago, IL 60637
United States

Bradley Shapiro

University of Chicago - Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States

HOME PAGE: http://faculty.chicagobooth.edu/bradley.shapiro/

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