I would lean more towards a conclusion like: "Stores that experience low sales apparently place products on discount and there is individual price elasticity".
The figure on page 38 shows that "Avg. Profit relative to existing Products in the Category" has a strong bias against "products that flopped" already at *Week1* relative to "Products that survived". That is *right* away, there is a systematic bias that seems constant so if I were to look at data after that I would be *highly* suspicious about directions of causality.
In addition, most of the article is vast amounts of bread-text that seem to support circular reasoning.
Can anyone find a place where they actually come up a direction of causality?
Proving the direction of causality being *from* the "harbingers"-group picking loosers could be supported by
- 1. Define the set of Harbingers
- 2. Introduce a number of new products.
- 2a. in half the shops at fixed prices
- 2b. in half the shops let the shop set the price
- 3. Show that the Harbingers from step1 purchase the same relative amount of the products in scenarios 2a and 2b.
Note, Separating the two parts without interference may be hard