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Demarketing as a differentiation strategy

Abstract

Demarketing discourages consumers from buying. This paper shows that demarketing can be a profitable alternative when differentiation through product improvements is not cost effective. The impact of differentiating demarketing on profit, market share, consumers, and total welfare is investigated.

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This research began while Hess was visiting MIT's Sloan School of Management and was finished while visiting University of Haifa; he thanks both for their support.

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Gerstner, E., Hess, J. & Chu, W. Demarketing as a differentiation strategy. Marketing Letters 4, 49–57 (1993). https://doi.org/10.1007/BF00994187

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Key words

  • Demarketing
  • Product Differentiation
  • Pricing