The Optimal Data Interval for Econometric Models of Advertising Carryover

Marketing Science, Forthcoming

37 Pages Posted: 25 May 2006

See all articles by Gerard J. Tellis

Gerard J. Tellis

University of Southern California - Marshall School of Business, Department of Marketing

Philip Hans Franses

Erasmus University Rotterdam (EUR) - Department of Econometrics

Abstract

The abundance of highly disaggregate data (e.g., at 5 second intervals) raises the question of the optimal data interval to estimate advertising carryover. The literature assumes that 1) the optimal data interval is the inter-purchase time, 2) too disaggregate data causes a disaggregation bias and 3) recovery of true parameters requires assumption of the underlying advertising process. In contrast, we show that 1) the optimal data interval is the inter-exposure time. 2) Too disaggregate data does not cause any disaggregation bias, and 3) recovery of true parameters does not require assumption of the advertising process but only data at the inter-exposure time. These results hold for any linear dynamic model linking sales with current and past advertising.

Keywords: Advertising carryover, Data Interval, Econometric Models

Suggested Citation

Tellis, Gerard J. and Franses, Philip Hans, The Optimal Data Interval for Econometric Models of Advertising Carryover. Marketing Science, Forthcoming. Available at SSRN: https://ssrn.com/abstract=904133

Gerard J. Tellis (Contact Author)

University of Southern California - Marshall School of Business, Department of Marketing ( email )

Hoffman Hall 701
Los Angeles, CA 90089-0443
United States
213-740-5031 (Phone)
213-740-7828 (Fax)

HOME PAGE: http://gtellis.net

Philip Hans Franses

Erasmus University Rotterdam (EUR) - Department of Econometrics ( email )

P.O. Box 1738
3000 DR Rotterdam
Netherlands
+31 10 408 1278 (Phone)
+31 10 408 9162 (Fax)

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