Optimal duration of integrated segment specific and mass promotion activities for durable technology products: a differential evolution approach

Promotion is carried out by firms for effective communication with potential customers so that response is achieved at different levels namely, awareness, interest, evaluation, trial, adoption, and market growth for the products. Firms have limited financial resources and time to market any of their products. Promotion activities on the other hand show diminishing returns. It is imperative for firms to use their resources judiciously and use scientific methods for related decisions. In this chapter, we propose an optimization model to determine the optimal duration of a promotion campaign for durable technology products marketed in a segmented market with an integrated segment-specific and mass promotion strategy. The proposed model at the same time incorporates the growth in the market potential due to promotional activities. There is limited scholarly research available in this domain and aspects of promotion and marketing environment considered in this study are not considered in any other research. Solution methodology based on nature-inspired optimization algorithm differential evolution is proposed, given the NP-hard nature of the proposed model and the suitability of the method to solve problems with real-valued decision variable with convergence to a global solution. A real-life case study is presented to illustrate model application, and test and compare performance with a similar recent study developed on the assumption of static market size. The proposed model shows fair results over the comparative study.