Abstract
The success of the introduction of a new product in a market is very sensitive to the marketing decision variables adopted by the firm. In the present paper we are concerned with the question of new product advertising in a heterogeneous oligopoly market consisting of N firms. A dynamic game is formulated to model strategic as well as sales interactions in such a market. Optimal advertising strategies are identified as open-loop Nash solutions.
This is a preview of subscription content, log in via an institution to check access.
Similar content being viewed by others
References
Bass FM (1969) A new product growth model for consumer durables. Management Science 15:215–227
Dockner EJ, Jørgensen S (1988a) Optimal advertising policies for diffusion models of new product innovation in monopolistic situations. Management Science 34:119–130
Dockner EJ, Jørgensen S (1988b) Optimal pricing strategies for new products in dynamic oligopolies. Marketing Science 7:315–334
Horsky D, Simon LS (1983) Advertising and the diffusion of new products. Marketing Science 2:1–18
Feichtinger G, Hartl RF (1986) Optimale Kontrolle ökonomischer Prozesse. Anwendungen des Maximumprinzips in den Wirtschaftswissenschaften. de Gruyter, Berlin
Little JDC (1979) Aggregate advertising models: The state of the art. Operations Research 27:629–667
Mahajan V, Wind Y (1986) Innovation Diffusion Models of New Product Acceptance. Ballinger, Cambridge, MA
Mehlmann A (1988) Applied differential games. Plenum, New York
Schmalensee R (1976) A model of promotional competition in oligopoly. Review of Economic Studies 43:493–508
Takayama A (1974) Mathematical economics. The Dryden Press, Hinsdale
Teng JT, Thompson GL (1983) Oligopoly models for optimal advertising when production costs obey a learning curve. Management Science 29:1087–1101
Teng JT, Thompson GL (1985) Optimal strategies for general price-advertising models. In: Opimal control theory and economic analysis 2, Feichtinger G (ed.), North-Holland, Amsterdam
Thepot J (1982) Marketing and Investment policies of duopolists in a Growing Industry. Journal of Economic Dynamics and Control 5:387–404
Thompson GL, Teng JT (1984) Optimal pricing and advertising policies for new product oligopoly models. Marketing Science 3:148–168
Author information
Authors and Affiliations
Additional information
The comments of two anonymous referees are appreciated. The first author wishes to acknowledge support from NSERC (Grant No. OGP0037342).
Rights and permissions
About this article
Cite this article
Dockner, E.J., Jørgensen, S. New product advertising in dynamic oligopolies. ZOR - Methods and Models of Operations Research 36, 459–473 (1992). https://doi.org/10.1007/BF01415762
Received:
Issue Date:
DOI: https://doi.org/10.1007/BF01415762