An aggregate sales model for consumer durables incorporating a time-varying mean replacement age

Steffens, Paul

doi:10.1002/1099-131x(200101)20:1<63::aid-for758>3.0.co;2-d

Cited by 36 publications

(8 citation statements)

References 10 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…We believe, however, that the confounding impact from durable quality improvements is rather limited. Long run or gradual quality improvements, as reflected in a durable's changing mean replacement age, may indeed be present (Steffens, 2001). However, our filtering approach removes all long-run developments from the series in a way that they do not intervene with our cyclical findings (see our discussion on the advantages of the Baxter and King filter in Section 3).…”

Section: Resultsmentioning

confidence: 99%

“…Accordingly, for durables introduced earlier, replacements are likely to make up a larger portion of their current sales, and to constitute a major part of the total durable performance (Bayus, 1988;Steffens, 2001).…”

Section: Datamentioning

confidence: 99%

“…Replacement purchases occur not only because of product failure. Durables may also be replaced for other reasons, such as the availability of new and/or improved features, or changing styles, tastes and fashion (Bayus, 1988;Steffens, 2001). This suggests that consumers tend to be quite flexible in changing the timing of a replacement purchase.…”

Section: Prior Expectationsmentioning

confidence: 99%

“…For more mature durables, a larger component of total sales is due to the replacement of existing units (Bayus, 1988;Steffens, 2001). We therefore run our cyclical sensitivity analysis separately on the early vs. later half of the sample period (cf.…”

Section: Testing Procedures and Empirical Findingsmentioning

confidence: 99%

See 3 more Smart Citations

Weathering Tight Economic Times: The Sales Evolution of Consumer Durables Over the Business Cycle

et al. 2004

View full text Add to dashboard Cite

Despite their obvious importance, not much marketing research focuses on how business-cycle fluctuations affect individual companies and/or industries. Often, one only has aggregate information on the state of the national economy, even though cyclical contractions and expansions need not have an equal impact on every industry, nor on all firms in that industry. Using recent time-series developments, we introduce various measures to quantify the extent and nature of business-cycle fluctuations in sales. Specifically, we discuss the concept of cyclical volatility, and derive a dynamic comovement elasticity between the economy as a whole and the cyclical fluctuations in various performance series. To further enhance our understanding of how consumers adjust their purchasing behavior across different phases of the business cycle, two other notable features related, respectively, to the relative size of the peaks and troughs and the rate of change in upward and downward parts of the cycle, are explicitly considered. Of specific interest in this respect are the notion of deepness and steepness asymmetry. We apply these concepts to a broad set (24) of consumer durables, for which we analyze the cyclical sensitivity in their sales evolution. In that way, we (i) derive a novel set of empirical generalizations, and (ii) test different marketing theory-based hypotheses on the underlying drivers of cyclical sensitivity. Consumer durables are found to be more sensitive to business-cycle fluctuations than the general economic activity, as expressed in an average cyclical volatility of more than four times the one in GNP, and an average dynamic comovement elasticity in excess of 2. This observation calls for an explicit consideration of cyclical variation in durable sales. Interestingly, the combined evidence across all durables suggests that asymmetry is present in the speed of up- and downward movements, as durable sales fall much quicker during contractions than they recover during economic expansions. Finally, key variables related to the industry’s pricing activities, the nature of the durable (convenience vs. leisure), and the stage in a product’s life cycle tend to moderate the extent of cyclical sensitivity in durable sales patterns. Copyright Springer Science+Business Media, Inc. 2004business cycles, sales evolution, consumer durables, time-series econometrics,

show abstract

Section: Resultsmentioning

confidence: 99%

Section: Datamentioning

confidence: 99%

Section: Prior Expectationsmentioning

confidence: 99%

Section: Testing Procedures and Empirical Findingsmentioning

confidence: 99%

See 2 more Smart Citations

Weathering Tight Economic Times: The Sales Evolution of Consumer Durables Over the Business Cycle

et al. 2004

View full text Add to dashboard Cite

show abstract

“…The repurchase process consists of multiple and replacement purchase [26,27]. Starting from zero, after sufficient time the repurchase rate must be proportional to 1/τ, where τ is the mean lifetime of the good.…”

Section: Unit Sales Evolution Of a Heterogeneous Goodmentioning

confidence: 99%

Dynamic Model of Markets of Successive Product Generations

Kaldasch

2015

SSRN Journal

View full text Add to dashboard Cite

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in ABSTRACTA dynamic microeconomic model is presented that establishes the price and unit sales evolution of heterogeneous goods consisting of successive homogenous product generations. It suggests that for a fast growing supply the mean price of the generations are governed by a logistic decline towards a floor price. It is shown that generations of a heterogeneous good are in mutual competition. Their market shares are therefore governed by a Fisher-Pry law while the total unit sales are governed by the lifecycle dynamics of the good. As a result the absolute unit sales of a generation exhibit a characteristic sales peak consisting of a rapid increase followed by a long tail. The presented approach shows that the evolution of successive product generations can be understood as an evolutionary adaptation process. The applicability of the model is confirmed by a comparison with empirical investigations on successive DRAM generations.

show abstract

Mittel- und langfristige Absatzprognose auf der Basis von Sättigungsmodellen

Mertens

Falk²

Prognoserechnung

View full text Add to dashboard Cite

An aggregate sales model for consumer durables incorporating a time-varying mean replacement age

Cited by 36 publications

References 10 publications

Weathering Tight Economic Times: The Sales Evolution of Consumer Durables Over the Business Cycle

Weathering Tight Economic Times: The Sales Evolution of Consumer Durables Over the Business Cycle

Dynamic Model of Markets of Successive Product Generations

Mittel- und langfristige Absatzprognose auf der Basis von Sättigungsmodellen

Contact Info

Product

Resources

About