Optimal Advertising Campaign Duration of Successive Generation Product using Diffusion of Information
Remica Aggarwal and Udayan Chanda
Department of Management, BITS Pilani, Pilani Campus
In the today’s global environment , competition
is stiff. Marketers are continuously introducing
successive generations of product based on
latest technology, either to continue to be the
leading brands or due to market forces. Due to
the dynamic nature of the market, it becomes
essential to integrate technological substitution
along with diffusion of new products. Advertising
of multiple products or multiple generation of a
present product involves selecting appropriate
advertising medium, analyzing the target
market and appropriate utilization of the
available advertising budget. An advertising
medium demands a huge proportion of the
firms’ budget to be spent on advertising and
therefore determination of an optimal duration
of the advertising campaign becomes extremely
important for any marketing manager. For an
advanced technology product , advertising at right
time become even more important. This study
developed a mathematical model to determine the optimal duration of an advertising campaign
for an advanced generation product based on
diffusion of information in a social group. The
optimal timing depends on diffusion coefficient, population size, ad cost per time unit, unit price
etc. The model is based on the assumption that technological advancements do not essentially
imply that existing generation products will be withdrawn from the market immediately.
Mathematical Programming, Multi-product Advertising , Successive Generations
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