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Offensive and defensive marketing: Closed-loop duopoly strategies

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Abstract

Offensive and Defensive Marketing: Closed-Loop Duopoly Strategies

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

  1. •

    well-defined closed-loop strategies can be developed that show directly the influence of market share on offensive and defensive marketing;

  2. •

    steady state is marked by balance between offensive and defensive marketing expenditures;

  3. •

    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.

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Authors and Affiliations

  1. Department of Marketing and International Business DJ-10, University of Washington, 98195, Seattle, WA

    Gary M. Erickson

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  1. Gary M. Erickson
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Erickson, G.M. Offensive and defensive marketing: Closed-loop duopoly strategies. Marketing Letters 4, 285–295 (1993). https://doi.org/10.1007/BF00994348

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  • DOI: https://doi.org/10.1007/BF00994348

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