Targeted advertising as a signal

@article{Anand2009TargetedAA,
  title={Targeted advertising as a signal},
  author={Bharat Anand and R. Shachar},
  journal={QME},
  year={2009},
  volume={7},
  pages={237-266}
}
This study presents a signaling model of advertising for horizontally differentiated products. The central ingredients of the model are two important characteristics of advertising—targeting, and noisy information content. The theory yields interesting results about the informational role of targeted advertising, and its consequences. First, targeting can itself serve as a signal on product attributes. Second, the effectiveness of targeting depends not only on firms knowing consumer preferences… Expand
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