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Offensive and Defensive Marketing: Closed-Loop Duopoly Strategies
Gary M. Erickson
Vol. 4, No. 4 (Oct., 1993), pp. 285-295
Published by: Springer
Stable URL: http://www.jstor.org/stable/40216310
Page Count: 11
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A modified Lanchester game is used to develop closed-loop strategies for offensive and defensive marketing expenditures of duopolistic competitors in a market share rivalry. Analysis of the model reveals that • well-defined closed-loop strategies can be developed that show directly the influence of market share on offensive and defensive marketing; • steady state is marked by balance between offensive and defensive marketing expenditures; • defensive marketing is more critical than offensive marketing due to greater risk of loss under deviation from closed-loop strategies. The last result would appear to have particularly important implications for both practice and research.
Marketing Letters © 1993 Springer