Abstract

During of writing this article, we analyze the models of economic dynamics that have a relationship between advertising and costs. It was found that advertising in these models did not have the character that it has in practice, namely it did not have a cumulative effect for subsequent periods. A model of economic dynamics was formulated during the research, this model include the cumulative effect of advertising messages, if advertising will affect sales not in pointly, but it will continue to influence in subsequent periods. Also, the effect of resales is integrated into the model if the drug has a small volume of release, has a short shelf life, or is often used for prevention viruses. To develop the model, a time-based modeling approach was used. It has been suggested that although advertising is cumulative, over time the impact of advertising diminishes until it disappears altogether. It is assumed that due to the establishment of production restrictions of the firm, the impact of previous sales weakens. When formulating the model, it is believed that with a positive experience of interaction with the product, in our case with drugs, buyers can repeat purchases and advise the tool to others. A suitable numerical calculation method was found to solve the model. The method of modified local variations was used for the calculation, which is not difficult to reproduce in practice even without significant mathematical training. A correlation analysis of sales advertising was performed using Pearson's correlation coefficients and autocorrelation and it was found that the relationship between them becomes weaker as the lag increases. The revenue function is presented in nonlinear form. In the course of calculations, it was found that the revenue is ascending, which confirms the positive impact of advertising on sales. The study was conducted with different sampling steps and with each step the accuracy increased, but at the same time the calculation time. This study will be useful both to marketing agencies that shape advertising budgets of companies and to pharmaceutical companies themselves that want to make investment in advertising more effective.

Full Text
Paper version not known

Talk to us

Join us for a 30 min session where you can share your feedback and ask us any queries you have

Schedule a call

Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.