Hani I. Mesak

An Exploratory Examination of the Influence of National Culture on Cross-National Product Diffusion

This study examines the direct influence of national culture on the cross-national diffusion of innovations. Focusing on seven technological innovations across 13 European countries, the authors use Hofstedes multidimensional approach to culture to investigate this relationship. They find support linking four cultural dimensions—individualism, masculinity, power distance, and long-term orientation—to cross-national product diffusion. The findings suggest that national culture explains a relatively sizable amount of variation in cross-national diffusion rates. The authors discuss theoretical and practical implications of these results, including prescriptive guidance with respect to product launch strategy and tactics.

Ethical Judgments of College Students: An Empirical Analysis

Abstract A considerable body of empirical research exists regarding factors that affect ethical decisionmaking in professional situations. This article examines the ethical judgments of college students as affected by four individual factors—gender, academic major, age, and religiosity. Findings from the study suggest that gender, academic major, and one dimension of religiosity—religious commitment—significantly influence the ethical judgments of college students. On the other hand, age and a second dimension of religiosity—religious affiliation—produced insignificant results.

Incorporating price, advertising and distribution in diffusion models of innovation: some theoretical and empirical results

Abstract On the theoretical side, this paper characterizes qualitatively optimum price, advertising and distribution policies for new products. Repeat sales and possible entry of rivals are disregarded but discounting of future profits streams and a cost learning curve are allowed. After characterizing optimal policies for a general diffusion model, the results pertaining to several models of specific functional form are reported. The results of the theoretical research show that the qualitative structure of optimal pricing policies of earlier univariate diffusion models in the literature remain robust upon the inclusion of other variables for a variety of multivariate models. On the empirical side, alternative diffusion models have been estimated and compared using non-linear procedures. The diffusion data analysed are related to the U.S. cable TV industry. Empirical research findings suggest that, for the considered case study, price affects the coefficient of innovation, advertising affects the diffusion rate, and distribution affects market potential. Based on price, advertising and distribution elasticities derived from the chosen diffusion model, the shapes of the advertising and distribution cost functions are identified.

Monopolist optimum pricing and advertising policies for diffusion models of new product innovations

On the theoretical side, this paper contains a general diffusion model of innovation that includes previous models in the literature as special cases. Optimal price and advertising are characterized qualitatively for the general model and several specific cases. Cost learning effects and discounting of future profits are considered, but repeat sales and likely entry of competitors are disregarded. On the empirical side, eighteen alternative diffusion models for a newly introduced innovation have been estimated and compared using non-linear procedures. Empirical research findings suggest that for the considered case study, price affects the coefficient of imitation whereas advertising affects the coefficient of innovation. Price (advertising) elasticity of demand is found to be increasing (decreasing) over time.

A pulsing model of advertising competition: A game theoretic approach, part A — Theoretical foundation

Abstract In this paper and its sequel, we present a theoretical model supported by both numerical and empirical analyses to evaluate the advertising policies of pulsation versus uniform (constant) spending using a static continuous Lanchester competitive model of two rival firms. The modeling effort is shown to be adaptable to a wide variety of realistic rivalry situations and its related derived main conclusions are robust for a broad set of assumptions. Following a game theoretic approach, it is found that Uniform Advertising Policy (UAP) is optimal for a firm having a concave or linear response function competing against another having a concave or linear response function and thus generalizing known results for a monopoly to a duopoly. When at least one of the response functions is convex, the study demonstrates that generalizing monopolistic results might not be adequate. For such situations, the optimal policy of the firm may involve the Advertising Pulsing/Maintenance Policy (APMP) replacing the monopolistic Advertising Pulsing Policy (APP) optimal when the response function is convex, or the monopolistic UAP optimal when the response function is concave or linear. For the competitive situations involving convex response function(s), the advertising game is solved using linear programming. The Lanchester model is empirically estimated, with considerable success, using the ready-to-eat cereal data in the US. In the application reported, both response functions are found to be linear implying the superiority of UAP for the application reported.

Optimal Pricing of New Subscriber Services under Interdependent Adoption Processes

This article develops and optimizes dynamic diffusion systems for new subscriber consumer services. Each proposed system is composed of two differential equations, one for the retailer adoption process and another for the consumer adoption process that incorporates price. Several of such systems are optimized using optimal control methods. Presence of interaction is found to significantly influence the qualitative characterization of pricing policies of new subscriber services. Furthermore, even when interaction is not present, the derived characterization of optimal pricing policies proved to be very different from those reported in the literature for new consumer durables.

Optimal advertising pulsation policies: a dynamic programming approach

This study formulates and solves an advertising pulsation problem for a monopolistic firm using dynamic programming (DP). The firm aims at maximising profit through an optimal allocation of the advertising budget in terms of rectangular pulses over a finite planning horizon. Aggregate sales response to the advertising effort is assumed to be governed by a modified version of the Vidale–Wolfe model in continuous time proposed by Little. Using a numerical example in which a planning horizon of one year is divided into one, two through ten equal time periods, computing routines are developed to solve 150 DP problems. Computational results show among other findings that the performance yielded by the DP policy dominates the uniform advertising policy (constant spending) for a concave advertising response function and the advertising pulsing policy (turning advertising on and off) for a linear or convex response function.

Impact of anticipated competitive entry and cost experience on optimal strategic pricing of technological innovations

Abstract The optimal pricing policies for a new product over time are derived for a monopolist in the absence and presence of cost experience effects. The main results for a myopic monopolist facing a demand function previously employed by Bass [1. J. Business 53 . 551–567 (1980)] suggest the following: — When competitive entry is anticipated, optimum prices and optimum profits are lower than their counterparts had it not been anticipated. — When cost experience is present, optimum prices are lower and optimum profits are higher than their counterparts had it not been present. For a monopolist maximizing the discounted profits over the planning horizon, the research shows that: — Optimal long-term prices arc equal to optimal myopic prices in the absence of cost experience. — Optimal long-term prices are lower than myopic prices in the presence of cost experience.

On the superiority of pulsing under a concave advertising market potential function

The authors study the superiority of advertising pulsing policy (turning advertising on and off in a cyclic fashion) over its uniform (constant spending) counterpart that costs the same under the assumption that sales dynamics follow a modified Vidale-Wolfe aggregate advertising model. The authors show that pulsing can be superior if the product of the concave market potential function and the linear or concave advertising response function is convex in advertising. Similar to previous studies in the literature, the average undiscounted profit over the infinite planning horizon is considered as a performance measure according to which alternative advertising pulsation policies are compared. Employing a well-known data set relating advertising to sales, the above convexity requirement is empirically supported and the superiority of pulsing is established numerically. The performance of the proposed model is found to be superior to two rival models using a one-step-ahead forecasting procedure. The analytical findings of the study are documented into six theoretical results for which proofs are relegated to a separate appendix. Managerial implications of the study and directions for future research are also discussed.

A pulsing model of advertising competition: A game theoretic approach, part B -- Empirical application and findings

In part A of this study, we have theoretically established the assertion that the subgames of alternating pulsing competition (APC) and matching pulsing competition (MPC) may not have saddle points at the corners if at least one of the firms has a convex response function (see Result 4 in Mesak and Calloway, 1995). In this second part, we give numerical support to the above result and illustrate the use of linear programming (LP) to solve pulsing games associated with such cases. All findings obtained thus far are summarized afterwards within a theoretical decision-making framework. We also report the results of an empirical investigation aimed at estimating the Lanchester model in a duopolistic setting. Finally, we shed light on the lessons learned from the entire study and highlight possible directions for future research.