Advertising, Brand Preferences, and Market Structures

Lun Li
This paper explores how innovations in advertising technology reshape consumers' brand preferences -- the propensity to purchase certain brands over others despite similar prices -- and lead to changes in the market structure. Using a comprehensive barcode-level dataset on grocery products, I document that the average concentration and markup for the selected categories have decreased by about 10% and 5% respectively, between 2010 and 2016. Using an occurrence-level advertisement expenditure and impression dataset, I find...
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