Modeling dynamic effects of promotion on interpurchase times


In this paper we put forward a duration model to analyze the dynamic effects of marketing-mix variables on interpurchase times. We extend the accelerated failure-time model with an autoregressive structure. An important feature of our model is that it allows for different long-run and short-run effects of marketing-mix variables on interpurchase times. As marketing efforts usually change during the spells, we explicitly deal with time-varying covariates. Our empirical analysis of purchases in three different categories reveals that, for some segments of households, the short-run effects of marketing-mix variables are significantly different from the long-run effects.Dynamic duration model;Error-correction model;Time-varying covariates;Unobserved heterogeneity

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Research Papers in Economics

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Last time updated on 7/6/2012View original full text link

This paper was published in Research Papers in Economics.

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