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Optimal pulsing in an advertising diffusion model
Author(s) -
Feichtinger Gustav,
Novak Andreas
Publication year - 1994
Publication title -
optimal control applications and methods
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.458
H-Index - 44
eISSN - 1099-1514
pISSN - 0143-2087
DOI - 10.1002/oca.4660150405
Subject(s) - purchasing , diffusion , schedule , advertising , limit (mathematics) , limit cycle , computer science , economics , econometrics , mathematics , marketing , business , physics , thermodynamics , mathematical analysis , operating system
Empirical evidence indicates that a given moderate number of ads per year may achieve higher effect when concentrated in flights than when spread equally. In the control‐theoretic literature a few approaches have been developed for which the optimal policy is a pulsing schedule. The present communication analyses a two‐state diffusion advertising model for repeat purchasing. Recognizing the interaction between customers and potential buyers, the optimal advertising policy turns out to be a persistent periodic oscillation. This provides a further interesting example in marketing for the existence of a stable limit cycle.