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Marketing Models Of Consumer Demand

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Executive Summary

Marketing researchers have used models of consumer demand to forecast future sales; to describe and test theories of consumer behavior; and to measure the response to marketing interventions. The basic framework typically starts from microfoundations of expected utility theory to obtain a statistical system that describes consumers' choices over available options, and to thus characterize product demand. The basic model has been augmented significantly to account for quantity choice decisions; to accommodate purchases of several products on a single purchase occasion (multiple discreteness and multi-category purchases); and to allow for asymmetric switching between brands across different price tiers.

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