Brand and Product Management

To optimally allocate its marketing mix across customers, a firm needs to consider the evolution of its customers over time. Changes in the marketing environment, as well as intrinsic changes in preferences or needs, may discretely shift customers into different buying-behavior states. The ability to identify the dynamics in customer behavior and its drivers presents an opportunity for the firm to influence the movement of customers to more favorable states of buying behavior.

We study a family of stylized assortment planning problems, where arriving customers make purchase decisions among offered products based on maximizing their utility. Given limited display capacity and no a priori information on consumers' utility, the retailer must select which subset of products to offer. By offering different assortments and observing the resulting purchase behavior, the retailer learns about consumer preferences, but this experimentation should be balanced with the goal of maximizing revenues.

Recent theoretical work predicts that an important margin of adjustment to deregulation or trade reforms is the reallocation of output within firms through changes in their product mix. Empirical work has accordingly shifted its focus towards multi-product firms and their product mix decisions. Existing studies have however focused exclusively on the U.S.

The U.S. pharmaceutical industry spent upwards of $18 billion on marketing drugs in 2007. Detailing and drug sampling activities account for the bulk of this spending. To stay competitive, pharmaceutical managers need to maximize the return on these marketing investments by determining which physicians to target, when, and how to target them. In this paper, we present a two-stage approach for dynamically allocating detailing and sampling activities across physicians to maximize long-run profitability.

When bad things happen, companies need the right strategy for talking their way out of a mess and avoiding a calamitous pummeling of their corporate image. Choosing the best response can spell the difference between a brand's survival — even enhancement — and its irreversible tarnishing.