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dc.contributor.authorNaik, Prasad A.en_US
dc.contributor.authorPeters, Kayen_US
dc.contributor.authorRaman, Kalyanen_US
dc.description.abstractDe Fleur (1956) provides the earliest evidence of diminishing returns. He finds a commonlogarithmic pattern for leaflets dropped and message recalled in field experiment. Since then,many researchers have applied logarithmic or square root patterns to capture the effect ofdiminishing returns with their advertising response modeling across different media. Butdiscussions with managers support the notion that the diminishing returns to incremental dollarsspent on one medium (say, television) are not likely to be the same as those for equivalent dollarsspent on other media (e.g., Print). But if diminishing returns indeed vary across media, how doesthat change the resulting allocation recommendation? To address this issue, we derive a dynamicmodel that captures the notion of differential diminishing returns and disentangles it from closelyrelated notions of differential carryovers and differential ad effectiveness. Second, we develop asystematic method to estimate the model's parameters using market data and illustrateempirically that all three effects, diminishing returns, carryover and ad effectiveness vary acrossthe four media employed. Finally, we investigate the normative implications for managerialdecision-making. Here, we additionally account for varying media buying efficiencies acrossmedia. Taken together, the approach and its illustration should provide managers with a bettertoolkit to allocate their multimedia budgets.en_US
dc.publisherZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft |cKiel und Hamburgen_US
dc.relation.ispartofseries|aArbeitspapiere des Lehrstuhls für Innovation, Neue Medien und Marketing, Institut für Betriebswirtschaftslehre, Universität Kielen_US
dc.titleHeterogeneous Response Functions in Advertisingen_US
dc.typeWorking Paperen_US

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