DEMON, MARK II: AN EXTREMAL EQUATION APPROACH TO NEW PRODUCT MARKETING,
Abstract
Numerous alternatives are available in the kinds of studies which can be elected in the market research which should precede the introduction of a new product. This gives rise to a possible network interpretation and treatment by an associated chance-constrained programming characterization and analysis. The resulting model, called DEMON (Decision Mapping Via Optimum GO-NO Networks) is replaced by an approach based on extremal equations. A general analytic characterization is achieved and then replaced by more special ones. Means for affecting study decisions and interferences are discussed along with the sensitivity analyses that we associate with GO and NO preemptions, relative to profit and payback constraints. Payback (in a constraint) is distinguished from its use as a criterion for choice (or objective), the latter being here oriented toward MEMP (maximize expected maximum profit). A chart is provided for interpreting these and other aspects of policy which bear on the problems of marketing a new product and, by reference to this chart, conditions are described in which an increase in the variance of possible outcomes may forestall an otherwise negative decision as when, for instance, expected profits (in a log-normal measure) might otherwise be regarded as 'too low'. (Author)
Document Details
- Document Type
- Technical Report
- Publication Date
- Dec 01, 1964
- Accession Number
- AD0612187
Entities
People
- A. Chranes
- D. B. Learner
- J. K. De Voe
- W. W. Cooper
Organizations
- Northwestern University