ANNAM. An artificial neural net attraction model to analyze market shares.

Harald Hruschka

Publication: Working/Discussion PaperWU Working Paper

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Abstract

The marketing literature so far only considers attraction models with strict functional forms. Greater exibility can be achieved by the neural net based approach introduced which assesses brands' attraction values by means of a perceptron with one hidden layer. Using log-ratio transformed market shares as dependent variables stochastic gradient descent followed by a quasi-Newton method estimates parameters. For store-level data the neural net model performs better and implies a price response qualitatively different from the well-known MNL attraction model. Price elasticities of these competing models also lead to specific managerial implications. (author's abstract)

Publication series

SeriesWorking Papers SFB "Adaptive Information Systems and Modelling in Economics and Management Science"
Number32

WU Working Paper Series

  • Working Papers SFB \Adaptive Information Systems and Modelling in Economics and Management Science\

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