A look at the Bass model: Report structure

Type :

Presentation

Pages :

16 pages

Format :

.doc

Published date :

01/16/2009

Category :

Business & market

Sub category :

Marketing

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Summary :

New product diffusion using the bass model.
1. Meaning of new product diffusion model.
2. An overview of the bass model.
3. Using analogous products in diffusion modeling.
4. The assumptions and limitations of the bass model.
5. Technical description of the components of the bass model.
6. Estimation procedures.
7. Ordinary least squares estimation.
8. Nonlinear least squares estimation.
The Variants of the bass model: Other diffusion models explored in brief.
1. The Mansfield model.
2. The Gompertz model.
Uses of Diffusion models.
1. Descriptive and normative uses.
A look at the model using the VCR data set.
1. Report of the findings & implications.
Conclusion.
References.

Abstract

Diffusion is a popular theory of communication used in marketing to model the first-purchase sales growth of a new product over time. As Mahajan et al (1990) put it diffusion theory suggests that a new product is first adapted by a few innovators who, in turn, influence others to adopt it. Taking this perspective on diffusion we can clearly see the pivotal role which interpersonal communication (word of mouth) between adopters and nonadopters plays in accounting for the rapid growth stage found in the diffusion process. It is important to remember that the value of diffusion modeling is not just restricted to historical data; rather leading academics in this field like bass have made predictions based on early sales data which have resulted in successful predictions of diffusions before those products reached their peak. From a commercial perspective there are endless examples of diffusion processes, which will be elaborated on later, including: the diffusion of blockbuster movies; mobile phones and other analogous products. For the purposes of this assessment we will discuss the principal theories in this field playing particular attention to bass and its variants, we will then apply these theories to the practical example of VCR diffusion.