Can advertising help to maintain dynamic market equilibrium?

Date of publication: October 23, 2005

Catalogue: Latin America 2005

Company: MindShare


This paper utilises the FMCG category in a mature market with sustained equilibrium and a considerable number of well-established products to assess two assumptions: the stability of the system through time, without launch of new products nor significant changes in key variables of currently existing products (distribution, price, promotions); and the instability of the system caused by the launch of a new product or significant change in key variables from any currently existing product. The paper analyses the role of advertising for each of these two cases.

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