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Pharmaceutical marketers use detailing, sampling and direct-to-consumer advertising (DTCA) to promote a branded prescription drug (brand drug) to health-care professionals and consumers. These promotion mix elements help raise brand awareness, increase prescription likelihood and guard a product market against competing brand drugs. However, the extent to which these elements remain effective when a brand drug goes off patent and its marketing exclusivity expires, allowing low-price generics to enter the market, remains unclear. This study aims to explore the effectiveness of promotion mix elements before and after the market entry of a generic drug.

The authors collected and analyzed a panel data set of 41 brand drugs from 7 therapeutic classes between 2007 and 2014 (3,201 observations) using the two-stage control function approach to address potential endogeneity.

The effectiveness of promotion mix elements changes significantly, but not in a universally uniform way, during a market transition. Detailing and DTCA are increasingly effective after a brand drug’s generics enter the market. In contrast, sampling is more effective before the market transition. The positive effects of sampling on brand sales are stronger when the price of a brand drug is higher than the average price of its competing brands. Sampling also helps amplify the positive influences of detailing and DTCA on brand sales.

This study shows that pharmaceutical promotion is not equally effective in the brand drug market with/without generic competitors. Detailing and DTCA are increasingly effective when generic competition intensifies. In contrast, the distribution of free drug samples is less effective after more generic drugs enter the market.

Incumbent brands’ promotion expenditures often drop dramatically when the expiration of their patents is near, a practice that likely continues after generics enter the market. Taking into consideration these industry norms and their findings, the authors suggest that promotional decisions during a market transition should not overly focus on cutting promotional expenditures across the board. Since a firm’s promotional expenditure tends to be expensive, factoring in information on the effectiveness of each promotion mix element helps marketers make well-informed strategic decisions on resource allocation during the transition from a market without generics to a market with generics.

Previous studies do not explicitly account for structural changes in the brand drug market over time. However, the expiration of patent and marketing exclusivity marks a transitional period in which a brand drug eventually competes with its generic counterparts. Given the criticality of such structural change, the authors examine brand drugs’ promotion effectiveness in the presence of their generic counterparts.

This study aims to investigate the impact of brand engagement on consumer responses to brand extensions, particularly in terms of value perception, attitude and purchase intention in a masstige context. The study examines low-fit/high-functionality and high-fit/low-functionality products. It also explores the crucial role of self-congruence in enhancing brand engagement, which leads to positive consumer responses towards brand extensions.

After establishing the theoretical foundations, pre-tests identified the product types and their fit level. In this quantitative study, 464 questionnaires were administered. Confirmatory factor analysis and structural equation modelling validated the model and tested the hypotheses for low-fit/high-functionality and high-fit/low-functionality products of a masstige brand.

Data analysis shows that brand engagement positively affects value perception, attitude and purchase intention. However, consumers’ responses to brand extension differed for low-fit versus high-fit products. Moreover, social self-congruence and actual and ideal self-congruence positively impact consumers’ active engagement with masstige brands.

This research shows that low-fit extensions of masstige brands can succeed with high functionality, while high-fit extensions mitigate the negative effects of low functionality, a key attribute of masstige brands. The study adds to the limited literature on self-congruence and engagement by identifying actual and ideal self-congruence as determinants of brand engagement. It is also among the first to demonstrate that social self-congruence drives brand engagement for masstige brands.