This paper uses a two stage methodology to examine the advertising response to new entry by incumbent firms. In the first stage, time-series regressions are employed to identify the advertising responses for a sample of 42 companies in consumer goods markets. In the second stage, cross-section analysis is used to model the factors which might explain the post-entry increase in advertising. The results suggest a systematic response by dominant firms in static markets and support the view that entry deterring behaviour is most likely where other entry barriers are already present.