Marketing Papers

Document Type

Technical Report

Date of this Version

2001

Publication Source

Interfaces

Volume

31

Issue

3 Supplement

Start Page

S94

Last Page

S107

DOI

10.1287/inte.31.3s.94.9683

Abstract

We conducted a modeling exercise in conjunction with the online music retailer CDNOW to develop a simple stochastic model of buyer behavior capable of forecasting medium-term aggregate CD purchasing by a cohort of new customers. We modeled weekly sales using a finite mixture of beta-geometric distributions with a separate time-varying component to capture nonstationarity in repeat buying. The resulting model can easily be implemented within a standard spreadsheet environment (for example, Microsoft Excel). It does a good job of describing the underlying sales patterns and produces an excellent medium-term forecast.

Copyright/Permission Statement

Originally published in Interfaces © 2001 INFORMS

This is a pre-publication version. The final version is available at http://dx.doi.org/10.1287/inte.31.3s.94.9683

Keywords

marketing-buyer behavior, forecasting-applications

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Date Posted: 15 June 2018

This document has been peer reviewed.