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Monopolistically Competitive Markets: The Power of Successful Product Differentiation

Monopolistically Competitive Markets: The Power of Successful Product Differentiation

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Monopolistically Competitive Markets:

The Power of Successful Product Differentiation

Competitive and Monopolistic Aspects

Many different brands Product differentiation

Marketing/Advertising

The power of brand name

Competitive and Monopolistic Aspects

$5.99

$3.99

Generic-brand “aspirin”

Advertising Expenditures (% of 2007 US Sales)Estee Lauder 30 L’Oreal 27

Schering-Plough 24

Mastercard 24

Reckitt Bensicker 20Clorox 17

Molson 14

Campbell Soup 12

Successful Marketing and Advertising

Price

Quantity

Demand 1

Demand 2

Average Cost 1

Average Cost 1

Unsuccessful Marketing and Advertising

Price

Quantity

Demand

Demand 2

Average Cost 1

Average Cost 2

Strategia “Italia”

“Strategia Italia”