MCS 3500 Chapter Notes - Chapter 1-2: Logistic Regression, Groupthink, Logit

• School: University of Guelph
• Department: Marketing and Consumer Studies
• Course: MCS 3500
• Professor: Tyler Hummel

Document Summary

Mass marketing is giving way to micromarketing. The drive to make data based decisions. Conceptual marketing: decision maker relies on his or her own mental model. Automated marketing: automating decision process using sophisticated information systems. A model is stylized representation of reality that is easier to deal with and explore for a specific purpose than reality itself. There are many types of models: verbal, box and error, graphical, mathematical, spreadsheets. Y = a + bx linear/through orgin. The prediction equation: sales = 5 x advertising. Dependent variable: sales (left of the equation sign) Independent variable: advertising (right of the equation sign) Parameters: the constants (a and b) require calibration. Carryover effect: influence of current activity on future periods. Customer-holdover effect: attracting a new customer with current expense, future value: customer retention rate 2) customer decay rate (churn) The only thing we know for sure here is that all of these numbers are definitely wrong (minimizing error, increasing accuracy)