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I analyze a quality signaling problem by a monopoly introducing a new experience good. A high‐quality type aims to signal itself to consumers but can be imitated by a low‐quality type with either a low or a high cost. In the unique separating equilibrium after deletion of dominated strategies, the high‐quality type separates through a marketing mix of price and dissipative advertising. Advertising is used despite the absence of repeat purchases or informed consumers.

Economists have emphasized the role of dissipative advertising and price as signals of quality. Most works, however, limit the number of types to two options: high and low quality. Yet, production costs and quality both result from R&D efforts and therefore are both uncertain. I characterize the optimal separating marketing mix (price and advertising) when quality and marginal cost are both subject to chance. In a static framework (no repeat purchases and no informed consumers), advertising appears to be necessary together with price to signal quality. Equilibrium profits depend on cost but not on quality: all rents are dissipated for signaling purpose.

Dominant firms often are unavoidable trading partners. Buyers may consider switching a fraction of their requirements to rival products, but that fraction is highly uncertain in rapidly evolving industries. Nonlinear pricing serves to adjust the competitive pressure placed on rival firms, depending on the joint distribution of the buyer willingness to pay for the rival's good and the share of contestable demand. Concave price‐quantity schedules erect barriers to entry. Convex parts in schedules introduce barriers to expansion. Dominant firms use all‐units discounts to create high entry barriers for rival firms with intermediate levels of contestable demand.

We study the exclusionary properties of nonlinear price‐quantity schedules in an Aghion‐Bolton style model with elastic demand and product differentiation. We distinguish three regimes, depending on whether and how the price charged by the dominant firm depends on the quantity purchased from the rival firm. We find that the supply of rival good is distorted downward. Moreover, given the quantity supplied from the rival, the buyer may opportunistically purchase inefficiently many units from the dominant firm to pocket quantity rebates. We show that the possibility for the buyer to dispose of unconsumed units attenuates the opportunism problem and limits the exclusionary effects of nonlinear pricing.

Résumé Cet article examine les stratégies de révélation de la qualité par un monopole offrant un bien de qualité inconnue. Nous examinons quatre environnements institutionnels : aucun signe de qualité n'est accessible, seule la certification est possible, seule l'adhésion à un label existe et enfin certification et label coexistent. Nous déterminons les équilibres dans chacun de ces environnements pour chaque configuration des coûts de label et de certification ainsi que du seuil de label. Le label soulève un problème de coordination entre les types possibles du monopole. De nombreuses configurations d'équilibre sont possibles, ce qui fait écho à la critique souvent adressée aux politiques de signes de qualité d'entretenir une certaine confusion dans l'esprit des consommateurs.