Managing Blood Donations with Marketing

Marketing Science, Forthcoming

35 Pages Posted: 30 Dec 2014 Last revised: 5 Jan 2015

See all articles by Ashwin Aravindakshan

Ashwin Aravindakshan

University of California, Davis

Olivier Rubel

University of California, Davis - Graduate School of Management

Oliver Rutz

University of Washington - Michael G. Foster School of Business

Date Written: September 11, 2014

Abstract

Blood banks rely on marketing to encourage donors to give blood. Many, if not most, blood banks in the U.S. are community-based not-for-profit organizations with limited marketing budgets. As a result, blood banks increasingly use novel and inexpensive online media, i.e., paid, owned and earned media, in their marketing efforts. We propose a dynamic model to help marketing managers of blood banks understand how blood donations can be managed via online paid, owned and earned media. We characterize the optimal forward-looking paid media strategies analytically taking into account the asymmetric costs related to shortage and excess of blood, as well as the possibility of a cost-free target donation zone. We detail new advertising resource allocation rules for blood banks and show when traditional allocation recommendations do not apply. Additionally, we discover that under certain circumstances, owned/earned media activities hurt the blood bank’s performance, despite being (mostly) free. We validate our analytical model by using daily donation data from a community-based blood bank and measure the effects of POEm activities on the level of blood donated.

Keywords: Blood Bank, Paid-Own-Earned Media, Social/Non-profit Marketing, Optimal Control, Time Series, Bayesian Estimation, Dynamic Linear Model

Suggested Citation

Aravindakshan, Ashwin and Rubel, Olivier and Rutz, Oliver, Managing Blood Donations with Marketing (September 11, 2014). Marketing Science, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2543688

Ashwin Aravindakshan (Contact Author)

University of California, Davis ( email )

One Shields Avenue
Davis, CA 95616
United States

HOME PAGE: http://ashwin.faculty.ucdavis.edu

Olivier Rubel

University of California, Davis - Graduate School of Management ( email )

One Shields Avenue
Davis, CA 95616
United States

Oliver Rutz

University of Washington - Michael G. Foster School of Business ( email )

Box 353200
Seattle, WA 98195-3200
United States

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