Paul Ellickson

Professor of Economics and Marketing at the Simon Business School University of Rochester

  • Rochester NY

Paul Ellickson researches quantitative marketing and industrial organization and has expertise in supermarkets, supercenters, and strategy

Contact

University of Rochester

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Areas of Expertise

Supermarket Strategy
Pricing
Supermarkets
Big Box Retailers
Walmart and Big Box Retailers
Data Analysis
Quantitative Marketing
Empirical industrial organization
Competitive Strategy
Retail Supercenters
Amazon
Retail Marketing
Grocery Retail
Grocery Stores

Biography

Professor Ellickson’s research interests lie at the intersection between quantitative marketing and industrial organization, with a focus on using structural modeling to understand the forces that drive strategic interaction and optimal decision making. He is particularly interested in modeling the importance of dynamic and spatial competition in retail trade. Ellickson’s research has been published in various academic journals including the Review of Economic Studies, the RAND Journal of Economics, Marketing Science, the Journal of Marketing Research, Quantitative Marketing and Economics, and the Journal of Economic Perspectives.

Education

Massachusetts Institute of Technology

PhD

Economics

2000

University of California, Berkeley

BA

Mathematics and Economics

1993

Selected Media Appearances

Why is Amazon buying a supermarket chain?

Irish Times  print

2017-06-21

Before A & P, Americans shopped at small-town stores that were “often run in a haphazard manner” and purchased their supplies from “a Byzantine collection of jobbers and middle men that was rife with corruption”, according to Paul Ellickson.

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A&P’s Imprint on New York Region Fades as Stores Close

Wall Street Journal  print

2015-11-19

A&P’s downfall began in the 1950s, because it was slow to adopt the modern supermarket format, which typically involved a wide variety of branded goods and products, advertising and building stores in the suburbs, said Paul Ellickson, a professor of economics and marketing at University of Rochester’s Simon School of Business. “They essentially missed that boat, and never regained their position as an innovative company,” he said.

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Worth The Deal? Groceries Get A Personalized Price

NPR  radio

2012-08-19

"Firms are always interested in charging different customers different prices," says Paul Ellickson, who teaches economics and marketing at the University of Rochester.

Ellickson says some people just don't notice price very much. They'll pay full price for what they want. That's profitable to supermarkets. What's even more profitable, however, is if supermarkets can offer a discount to the other folks, to nudge them into buying as well. Ellickson says we're already used to paying different prices for some things.

"Airline tickets are a good example — if you buy very late, you expect to pay a fair amount. If you buy early, you expect to maybe pay less," he says. "But when you're buying exactly the same product at exactly at the same point in time, and you and the person right next to you are paying different prices, you may get irritated with that."

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Selected Articles

The Competitive Effects of Entry: Evidence from Supercenter Expansion

American Economic Journal: Applied Economics

Paul B. Ellickson, Peter Arcidiacono, Carl F. Mela, John D. Singleton

2020-07-03

Coupling weekly grocery transactions with the exact location and opening date of Walmarts over an 11-year period, we examine how Supercenter entry affects prices and revenues at incumbent supermarkets. We find that entry within 1 mile of an incumbent causes a sharp 16 percent drop in revenue, a competitive effect that decays quickly with distance. Surprisingly, despite large cross-sectional differences in supermarket prices by exposure to Walmart, our findings also indicate that Supercenter entry has no causal effect on incumbent prices. This result is robust across many dimensions, including a lack of price response for individual products, and across brands within a category.

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Measuring Competition in Spatial Retail

Rand Journal of Economics

Paul B. Ellickson, Paul L.E. Grieco, and Oleksii Khvastunov

2020-03-05

We propose and estimate a spatially aggregated discrete‐choice model with overlapping consumer choice sets and demographic‐driven heterogeneity that varies by chain. Our approach avoids the need to define markets ex ante and captures rich substitution patterns, even in the absence of price data. An application to the US grocery industry illustrates the importance of location, format, and the spatial distribution of consumers in shaping the competitive environment. Contrary to conventional wisdom, we find substantial cross‐format competition between supercenters, clubs, and traditional grocers. Finally, we evaluate two representative mergers between supermarket chains to demonstrate how our estimates inform antitrust policy.

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Product Launches with New Attributes: A Conjoint-Loyalty Card Technique for Estimating Demand

Journal of Marketing Research

Paul B. Ellickson, Mitchell J. Lovett, and Bhoomija Ranjan

2019-01-01

We propose and empirically evaluate a new hybrid estimation approach that integrates choice-based conjoint with repeated purchase data for a dense consumer panel, and show that it increases the accuracy of conjoint predictions for actual purchases observed months later. Our key innovation lies in combining conjoint data with a long and detailed panel of actual choices for a random sample of the target population. By linking the actual purchase and conjoint data, we can estimate preferences for attributes not yet present in the marketplace, while also addressing many of the key limitations of conjoint analysis, including sample election and contextual differences. Counterfactual product and pricing exercises then illustrate its managerial relevance.

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