Bayesian Estimation and Control of Detailing Effort in a Repeat Purchase Diffusion Environment

This paper develops a model and an associated estimation procedure to forecast and control the rate of sales for a new product. A repeat-purchase diffusion model is developed, incorporating the effect of marketing variables—detailing force effects in particular—as well as a word-of-mouth effect. Bayesian estimation, with priors developed from past products is used to estimate and update the parameters of the model. The procedure is used to develop marketing policies for new product introduction.