Market structure analysis using managerial judgments: A framework and an experimental test

Abstract

AbstractManagerial judgments are essential inputs in market structure analysis. The basic premise of this research is that by using structured elicitation methods that rely on the underlying logic of competitive market structure analysis (CMSA) models, it may be possible to effectively extract and organize managers' knowledge of competitive relationships. In this study, the authors examine how managerial judgments are influenced by two elicitation methods (perceived competitive similarity and forced choice) and three specific priming cues (brand image, features, and usage situation). The focus is on examining the learning effects of feedback and concordance of judgments across elicitation methods. The results showed significant effects of both feedback and elicitation method, but not for the primed cue. Relative to the perceptual similarity method, the forced choice method helped subjects better articulate the veridical structure of the market. Also, the forced choice method produced more concordant judgments of market structure when followed by perceptual similarity as compared to the reverse (i.e., perceived similarity followed by forced choice). This suggests that the forced choice elicitation method produces a more stable perception of market structure. © 1996 John Wiley & Sons, Inc.