A Responsive Framework for Optimal Advertising Policy in the Digital Music Market

Abstract

This paper proposes a novel responsive framework to help the record label in making profit maximizing advertising decisions in the product pre-release phase. We describe a market of potential consumers where the consumer behaviors are backed by an interactive Markov Chain, in which the periodic advertising activities carried out by the record label varies the population frequencies of the potential consumer market. We demonstrate the working of the proposed framework through an illustrative numerical example, results of the study show the proposed framework's superiority both in terms of reach to potential consumers and the net profit it brings. 