Premium
Optimal Allocation of Generic Advertising Budgets
Author(s) -
McClelland Edward L.,
Polopolus Leo,
Myers Lester H.
Publication year - 1971
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.2307/1237819
Subject(s) - production (economics) , commodity , advertising , business , measure (data warehouse) , computer science , microeconomics , economics , finance , database
A model is developed for allocating advertising budgets among multiple consumer products marketed in several regions so that total consumer expenditures net of advertising costs are maximized. The model pertains specifically to unbranded commodity advertising where the budget is dependent upon uncontrolled industry production. Time series‐based empirical estimates of consumer sales response to advertising expenditures are utilized as input data in a quadratic programming algorithm. Consumer expenditures under optimum and actual allocations were compared for selected historical budgets of the Florida Department of Citrus to obtain a measure of possible gain from more efficient allocation of advertising funds