Research Reports from the Department of Operations
Document Type
Report
Publication Date
1-1-1987
Abstract
This paper explores the forecasting and advertising planning implications of an innovation diffusion model with stochastic parameters. Comparisons are made between the stochastic model and its deterministic version. It is shown that the stochastic formulation may sometimes yield forecasted penetration curves which can be approximated quite well by a deterministic model. This, however, is not always true. In planning an advertising policy over some time horizon, it is shown how the nature of the advertising policy depends on the stochastic characteristics of the diffusion process as well as the firm's attitude toward risk.
Keywords
Stochastic processes, Operations research, Diffusion of innovations--Mathematical models, Advertising--Planning, Forecasting--Mathematical models, Risk assessment, Marketing--Decision making, Business planning, Consumer behavior--Mathematical models
Publication Title
Technical Memorandums from the Department of Operations, School of Management, Case Western Reserve University
Issue
Technical memorandum no. 609
Rights
This work is in the public domain and may be freely downloaded for personal or academic use
Recommended Citation
Eliashberg, Jehoshua; Tapiero, Charles S.; and Wind, Yoram, "Innovation Diffusion Models with Stochastic Parameters : Forecasting and Planning Implications" (1987). Research Reports from the Department of Operations. 249.
https://commons.case.edu/wsom-ops-reports/249
