Marketing Letters

, Volume 7, Issue 1, pp 77–94 | Cite as

Consumer inventory sensitivity and the postpromotion dip

  • Scott A. Neslin
  • Linda G. Schneider Stone


We summarize and critique seven theories that might explain the lack of a postpromotion dip in sales in the weeks following a promotion. We then propose and provide empirical support for a new explanation. We argue that in markets where the consumer category purchase decision is not strongly influenced by inventory levels, the displacement effect of accelerated sales will tend to be distributed fairly uniformly into the future such that clearly defined dips are not observed. We utilize a simulation based on real data to investigate this explanation. The simulation shows that given the degree to which inventory influences the purchase decision, we would not expect to see postpromotion dips, even though promotion influences the purchase decision. However, the simulation shows that if inventory had a greater influence on the purchase decision, we would expect to see postpromotion dips. We conclude with implications for both researchers and managers.

Key words

promotion scanner data simulation 


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Copyright information

© Kluwer Academic Publishers 1996

Authors and Affiliations

  • Scott A. Neslin
    • 1
  • Linda G. Schneider Stone
    • 2
  1. 1.Amos Tuck School of Business AdministrationDartmouth CollegeHanoverUSA
  2. 2.Department of Marketing and Logistics Management, Curtis L. Carlson School of ManagementUniversity of MinnesotaMinneapolisUSA

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