INTERNET MARKETING BUDGET ALLOCATION: FROM PRACTITIONER'S PERSPECTIVE

Consider a firm promotes its products through several Internet media with a fixed Internet marketing budget and models the budget allocation decisions as a competitive game, in which each firm formulates its own optimization model that is influenced by the competitors' moves as well. One challenge to the application of such model in practice is how to deal with asymmetric information. In this paper, we discuss several issues that are often asked by the practitioners that are related to dealing with asymmetric information. Among them are (1) how accurate of the estimated model used by the firm is good enough in the absence of other firms' strategy information; and (2) what the indicators are that currently used model becomes outdated.