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Delayed effects of cooperative advertising in goodwill dynamics

Author:
Machowska, Dominika  


Journal:
OPERATIONS RESEARCH LETTERS


Issue Date:
2019


Abstract(summary):

This paper proposes a tool to control cooperative advertising which increases the goodwill of companies operating in a competitive market. We introduce the lag between advertising exposure and customer reaction in the goodwill dynamics evolved a la Nerlove-Arrow. As a result, we obtain a cooperative differential game with immediate and delayed effects of control variables for which we investigate the optimal solution. We examine the role the pre-coalition programmes and the length of delayed response in generating goodwill. (C) 2019 Elsevier B.V. All rights reserved.


Page:
178---184


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