TITLE

Dynamic Marketing Budget Allocation Across Countries, Products, and Marketing Activities

AUTHOR(S)
Fischer, Marc; Albers, Sönke; Wagner, Nils; Frie, Monika
PUB. DATE
July 2011
SOURCE
Marketing Science;Jul/Aug2011, Vol. 30 Issue 4, p568
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
Previous research on marketing budget decisions has shown that profit improvement from better allocation across products or regions is much higher than from improving the overall budget. However, despite its high managerial relevance, contributions by marketing scholars are rare. In this paper, we introduce an innovative and feasible solution to the dynamic marketing budget allocation problem for multiproduct, multicountry firms. Specifically, our decision support model allows determining near-optimal marketing budgets at the country-product-marketing-activity level in an Excel-supported environment each year. The model accounts for marketing dynamics and a product's growth potential as well as for trade-offs with respect to marketing effectiveness and profit contribution. The model has been successfully implemented at Bayer, one the world's largest pharmaceutical and chemical firms. The profit improvement potential is more than 50% and worth nearly €500 million in incremental discounted cash flows.
ACCESSION #
65096997

 

Related Articles

  • Dynamically Allocating the Marketing Budget: HOW TO LEVERAGE PROFITS ACROSS MARKETS, PRODUCTS AND MARKETING ACTIVITIES. Fischer, Marc; Albers, S�nke; Wagner, Nils; Frie, Monika // GfK-Marketing Intelligence Review;May2012, Vol. 4 Issue 1, p50 

    Marketing budget decisions are critical and should be fact based rather than intuitive. Profit can be improved by better allocating a fixed budget across products or regions. The Excel-based decision support model presented in this article makes it possible to determine near-optimal marketing...

  • CONTEMPORARY APPROACHES OF COMPANY PERFORMANCE ANALYSIS BASED ON RELEVANT FINANCIAL INFORMATION. Popa, Dorina; Kiss, Melinda; Sziki, Klara // Annals of the University of Oradea, Economic Science Series;2012, Vol. 21 Issue 2, p708 

    In this paper we chose to present two components of the financial statements: the profit and loss account and the cash flow statement. These summary documents and different indicators calculated based on them allow us to formulate assessments on the performance and profitability on various...

  • The road to power: partisan loyalty and the centralized provision of local infrastructure. Joanis, Marcelin // Public Choice;Jan2011, Vol. 146 Issue 1/2, p117 

    This paper sets out a simple dynamic probabilistic voting model in which a government allocates a fixed budget across electoral districts that differ in their loyalties to the ruling party. The model predicts that the geographic pattern of spending depends on the way the government balances...

  • Designing Buyback Contracts for Irrational But Predictable Newsvendors. Becker-Peth, Michael; Katok, Elena; Thonemann, Ulrich W. // Management Science;Aug2013, Vol. 59 Issue 8, p1800 

    One of the main assumptions in research on designing supply contracts is that decision makers act in a way that maximizes their expected profit. A number of laboratory experiments demonstrate that this assumption does not hold. Specifically, faced with uncertain demand, decision makers place...

  • Expert rule versus majority rule under partial information. Berend, Daniel; Harmse, Jorgen E. // Theory & Decision;Sep93, Vol. 35 Issue 2, p179 

    Examines the uncertain dichotomous choice model. Model development; Optimality of the expert rule and the majority rule; Outcomes of deviations from the rules; Results of disagreements between bottom and top experts.

  • A challenge to the compound lottery axiom: A two-stage normative structure and comparison... Davis, Donald B.; Pate-Cornell, M.-Elisabeth // Theory & Decision;Nov94, Vol. 37 Issue 3, p267 

    Examines preferences among uncertain prospects when the decision maker is uneasy about his assignment of subjective probabilities. Two-stage lottery framework for analysis of prospects; Representation of the first stage of an assessment of vagueness; Representation of the second stage of an...

  • Any complete preference structure without circuit admits an interval representation. Abbas, Moncef // Theory & Decision;Sep95, Vol. 39 Issue 2, p115 

    Presents a complete preference structure called tolerance interval order. Representation by intervals of the real line when the strict preference relation has no circuit; Compatibility of strict preference with a certain degree of overlapping of intervals; Specification of the allowed degree by...

  • Preference extension rules for ranking sets of alternatives with a fixed cardinality. Bossert, Walter // Theory & Decision;Nov95, Vol. 39 Issue 3, p301 

    Deals with the analysis of problems in individual and collective decision making involving the comparison of sets of alternatives. Analysis of the problem of deriving a ranking of fixed-cardinality subsets of a universal set from a given ranking of the elements of this universal set;...

  • Comments on M.E. Brady's extension to J.M. Keynes decision rule. Narayanan, Sunder // Psychological Reports;Aug94, Vol. 75 Issue 1, p126 

    Discusses the extension offered by M.E. Brady on J.M. Keynes' decision rule. Presentation of a more general rule.

Share

Read the Article

Courtesy of VIRGINIA BEACH PUBLIC LIBRARY AND SYSTEM

Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics