Work

A dynamic discount pricing strategy for viral marketing

Year: 2018

Type: article

Abstract: Viral marketing has been one of the main marketing modes. However, theoretical study of viral marketing is still lacking. This paper focuses on the problem of developing a cost-effective dynamic discount pricing strategy for a viral marketing campaign. First, based on a novel word-of-mouth propagation model, we model the original problem as an optimal control problem. Second, we show that the optimal control problem admits an optimal control and present the optimality system for solving the optimal control problem. Next, we solve some optimal control models to get their respective optimal dynamic discount pricing strategies. Finally, we examine the effect of some factors on the maximum marketing profit. These results contribute to gaining insight into viral marketing.

Source: PLoS ONE

DOI: 10.1371/journal.pone.0208738

Authors: Xiang Zhong, Juan Zhao, Lu-Xing Yang, Xiaofan Yang, Yingbo Wu, Yuan Yan Tang

Institutions: Chongqing University, Deakin University, City University of Hong Kong, University of Macau

Language: English

Topic: Supply Chain and Inventory Management

Subfield: Management Science and Operations Research

Field: Decision Sciences

Domain: Social Sciences

Open Access status: gold

Estimated APC paid: $2,382

Funder: National Natural Science Foundation of China