A Hybrid Approach to Modelling Advertising Effects - An Application to Optimal Lying in the Software Business

Abstract

Considering different businesses there is wide range of marketing strategies the companies can focus on - related to the products and the structure of their business. In some businesses the products and their features are in the center of the consumers interest and the advertising claim is geared to the attributes forming a preferably attractive USP. Other products are mainly driven by pure advertising as the features of the product are hardly accessible and appraisable. Depending to the business and the product category the post-purchase satisfaction of the consumers depends either on the product image driven by pure advertising or purely on the mensureable product features or on both. So in many businesses the post-purchase satisfaction of the consumer is highly related to the gap between the pre-purchase advertising claim - which triggered the purchase - and the first-hand evaluation of the product features after the purchase. Here a big gap and the resulting high level of dissatisfaction additionally triggers a propagation of the gap under the circle of friends. Generally the aim of the companies is to optimize this gap due to advertising should trigger the purchase even if the product doesn’t exactly achieve the needs of the consumer but should avoid dissatisfaction due to the resulting negative recommendations.