Allocating marketing resources over social networks: A long-term analysis

Vineeth Varma (1) , Samson Lasaulce (2) , Julien Mounthanyvong (2) , Irinel-Constantin Morarescu (1)

1 CRAN - Centre de Recherche en Automatique de Nancy
2 L2S - Laboratoire des signaux et systèmes

In this paper, we consider a network of consumers who are under the combined influence of their neighbors and external influencing entities (the marketers). The consumers' opinion follows a hybrid dynamics whose opinion jumps are due to the marketing campaigns. By using the relevant static game model proposed recently in [1], we prove that although the marketers are in competition and therefore create tension in the network, the network reaches a consensus. Exploiting this key result, we propose a coopetition marketing strategy which combines the one-shot Nash equilibrium actions and a policy of no advertising. Under reasonable sufficient conditions, it is proved that the proposed coopetition strategy profile Pareto-dominates the one-shot Nash equilibrium strategy. This is a very encouraging result to tackle the much more challenging problem of designing Pareto-optimal and equilibrium strategies for the considered dynamical marketing game.

Domaines: Automatique

Vineeth Varma, Samson Lasaulce, Julien Mounthanyvong, Irinel-Constantin Morarescu. Allocating marketing resources over social networks: A long-term analysis. IEEE Control Systems Letters, 2019, 3 (4), pp.1002-1007. ⟨10.1109/LCSYS.2019.2919959⟩. ⟨hal-02390680⟩