DEMOGRAPHIC VARIABILITY IN U.S. CONSUMER RESPONSIVENESS TO CARBONATED SOFT-DRINK MARKETING PRACTICES

Using three years of Nielson Homescan and advertising data from 16 major metropolitan areas across the U.S. to construct a panel data set that follows weekly consumer purchasing behavior, this paper investigates the impact of marketing activities on a representative cross-section of U.S. consumers. Because many consumers do not participate in the market week-in and week-out, I apply Heckman’s econometric selection model to recover the impact of pricing, advertising, and promotion on a wide range of consumer segments. Reduced-form estimates of consumer responsiveness to these marketing activities reveal different effects across consumer segments, which have numerous implications for marketing policy.