Product Strategy and Antitrust: A Consumer Choice Perspective

Abstract

Traditionally antitrust law is strongly tied to price theory economics so that prices, costs, profits, and profit sacrifice are typically examined in antitrust cases. This paper proposes broadening traditional antitrust analysis to also explicitly examine the likely effect of allegedly anticompetitive conduct on product options and consumer choice. In order to accomplish this task, this paper proposes that various aspects of marketing strategy should be considered when examining product strategies that are accused of being anticompetitive. This paper further suggests that the current list of inconsistently and poorly defined product strategies used by the courts be augmented by three more straight forward but overlapping categories based on impact on consumer choice: Lock‐Outs, Lock‐Ins, and Hold‐Ups.

Is uniform pricing by competing retailers perceived as fair?

“…This explains why the planning, organisation, and implementation of price‐fixing conspiracies are often orchestrated by marketing managers (Pressey et al, 2014). Based on the importance of price‐fixing and its marketing relevance, it is remarkable that there are only a handful of price‐fixing studies in consumer behaviour (Grewal & Compeau, 1999; Ho & Chan, 2003; Petty, 2018). This is a significant shortcoming because consumers worldwide continue to pay excessively high prices for products and services, resulting in a lower standard of living for all.…”

“Not me” consumer justifications for not reporting suspected price‐fixing activities: Neutralization techniques & counterstrategies

“…In this sense, understanding consumers' willingness to report suspected price‐fixing cases is a critical concern. Among other areas, there is little knowledge regarding price‐fixing from the consumers' perspective (Grewal & Compeau, 1999; Ho & Chan, 2003; Petty, 2018).…”