The Effects of Pharmaceutical Direct.docVIP

Why Do Firms Invest in Consumer Advertising with Limited Sales Response? A Shareholder Perspective Ernst C. Osingaa Peter S.H. Leeflangb Shuba Srinivasanc Jaap E. Wieringab November 30, 2009 a Ernst C. Osinga is Assistant Professor of Marketing (e-mail: e.c.osinga@uvt.nl; tel.: +31134668774), CentER, Department of Marketing, Tilburg University, PO Box 90153, 5000 LE, Tilburg, the Netherlands. b Peter S.H. Leeflang is the Frank M. Bass Professor of Marketing (e-mail: p.s.h.leeflang@rug.nl; tel.: +31503633696), and Jaap E. Wieringa is Associate Professor of Marketing (e-mail: j.e.wieringa@rug.nl; tel.: +31503637093), Department of Marketing, Faculty of Economics and Business, University of Groningen, PO Box 800, 9700 AV Groningen, the Netherlands. c Shuba Srinivasan is Associate Professor of Marketing and Dean’s Research Fellow (e-mail: ssrini@; tel.: 6173535978), Boston University, School of Management, 595 Commonwealth Avenue, Boston, MA 02215. The authors thank the Marketing Science Institute for financial support. For their insightful comments, the authors thank the guest editor, Raj Srivastava, and two anonymous reviewers, participants at the 2007 and 2008 Marketing Science Conferences, the research seminar of the School of Management at Boston University, the 2008 Stakeholder Marketing Conference in Boston, and the Marketing Strategy Meets Wall Street Conference at Emory University in 2009. They also thank Dominique Hanssens and C.B. Bhattacharya for their insightful comments. Why Do Firms Invest in Consumer Advertising with Limited Sales Response? A Shareholder Perspective Abstract Marketing managers increasingly recognize the need to measure and communicate the impact of their actions on shareholder returns. This study focuses on the shareholder value effects of pharmaceutical direct-to-consumer advertising (DTCA) and direct-to-physician (DTP) marketing efforts. Although DTCA has moderate effects on brand sales and market share, companie