Joint optimization of pricing and advertisement for seasonal branded products

The goal of this paper is to develop a model to integrate “pricing” and “advertisement” for seasonal branded products such as branded fashion clothing products. To achieve this goal, we apply the concept of “Dynamic Pricing”. The demand for each product is stochastic and depends on its price, advertising methods as well as its life time. There are two classes of advertisements, for the brand (regardless of product) and for a particular product. Advertising the brand affects the demand and price of all products of that brand. Thus, the model considers all these products in relation to each other.

Keywords:

Dynamic pricing , Promotion , Advertising , Dynamic programming