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Assessing the effect of advertising expenditures upon sales: A Bayesian structural time series model.

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Gallego, Víctor and Suarez García, Pablo and Angulo, Pablo and Gómez-Ullate Otaiza, David (2019) Assessing the effect of advertising expenditures upon sales: A Bayesian structural time series model. Applied stochastic models in business and industry, 35 (3). pp. 479-491. ISSN 1524-1904

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Official URL: http://dx.doi.org/10.1002/asmb.2460




Abstract

We propose a robust implementation of the Nerlove-Arrow model using a Bayesian structural time series model to explain the relationship between advertising expenditures of a countrywide fast-food franchise network with its weekly sales. Due to the flexibility and modularity of the model, it is well suited to generalization to other markets or situations. Its Bayesian nature facilitates incorporating a priori information reflecting the manager's views, which can be updated with relevant data. This aspect of the model will be used to support the decision of the manager on the budget scheduling of the advertising firm across time and channels.


Item Type:Article
Additional Information:

© 2019 Wiley.
Número especial.
Workshop on Games and Decisions in Reliability and Risk (GDRR)(5. 2017. Madrid,España).
The authors acknowledge financial support from the Spanish Ministry of Economy and Competitiveness, through the "Severo Ochoa Programme for Centres of Excellence in R&D", Grant/Award Number: SEV-2015-0554; Spanish Ministry of Education, Grant/Award Number: FPU16/05034; Spanish MINECO-FEDER, Grant/Award Number: MTM2015-65888-C4-3 and MTM2015-72907-EXP.

Uncontrolled Keywords:Bayesian structural time series; Budget allocation; Risk management; Sales forecasting.
Subjects:Sciences > Physics > Physics-Mathematical models
Sciences > Physics > Mathematical physics
ID Code:56987
Deposited On:27 Sep 2019 16:10
Last Modified:01 Oct 2019 09:28

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