EVALUATION OF MULTI-BRAND STRATEGY EFFECTIVENESS IN NICHE E COMMERCE UNDER SPONSORED SEARCH AUCTIONS: EVIDENCE FROM CONTRIBUTION MARGIN ANALYSIS

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2026-05

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Shukhrov, Dmytro

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Abstract

The growth of digital platforms allows e-commerce firms to scale via multi-brand models. This study empirically evaluates the financial effectiveness of Company X’s intuitive launch of three custom-printed wallpaper brands with overlapping catalogs but distinct price positioning. It analyzes whether these brands cannibalize each other's demand across three geographic markets. The research addresses four key questions regarding financial impact, source of growth, cannibalization risks, and market-size moderation, testing two main hypotheses (H1 and H2). Key Findings and Contributions: H1 confirmed: Co-owned brands do not experience demand cannibalization due to algorithmic audience segmentation (distinct seed audiences from different launch timing) and natural price sensitivity differences. H2 confirmed: The multi-brand model generates an additive, not substitutive, increment in total contribution margin. New Concept: Strategy effectiveness depends on the incumbent brand's maturity stage. Launching a second brand prematurely in early-stage markets with increasing marginal returns reduces short-term efficiency. Managerial Recommendations: Company X should use maturity indicators (advertising slope, YoY margin dynamics) to trigger new launches and invest in content differentiation.

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multi-brand strategy, contribution margin, demand cannibalization, algorithmic audience segmentation, e-commerce, digital advertising auctions, price-based segmentation, brand maturity stage, counterfactual analysis

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Shukhrov, Dmytro. (2026). EVALUATION OF MULTI-BRAND STRATEGY EFFECTIVENESS IN NICHE E COMMERCE UNDER SPONSORED SEARCH AUCTIONS: EVIDENCE FROM CONTRIBUTION MARGIN ANALYSIS. Kyiv: American University Kyiv. URI: https://er.auk.edu.ua/handle/234907866/186

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https://er.auk.edu.ua/handle/234907866/186

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School of Management (capstones)