The Effect of Advertising on Liquor Brand Sales

Abstract

This study estimates the revenue and profit generated by increments of advertising expenditures for liquor brands. Various distributed-lag regressions were fitted to ten-year periods for 15 brands ranging from small to largest. Found were annual retention rates around .75, and a logarithmic response function. Perhaps most important, this technique, pioneered by Telser and Palda, is again found useful.