Editors |
Title: Market Segmentation Strategies of Multiproduct Firms Author(s): Ulrich Doraszelski and Michaela Draganska Volume: 54 Issue: 1 Pages: 125-149 Abstract: We analyze a multiproduct duopoly and ask whether firms should offer general purpose products or tailor their offerings to fit specific consumer needs. Offering a targeted product has two effects: utility increases for some consumers due to increased fit, whereas utility decreases for others due to increased misfit. Previous work has not considered these two effects jointly and has therefore not been able to capture the trade-off inherent in market segmentation. We show that in addition to the degree of fit and misfit, the intensity of competition and the fixed cost of offering an additional product determine firms' market segmentation strategies.
[Previous Article] [Next Article] [This Issue] [Next Issue]
|
|
Last modified 04/04/2006 © Copyright 2006 The Journal of Industrial Economics, Ltd. |