Marketing modeling reality and the realities of marketing modeling

This paper shows how analytic modeling research in the Marketing field is focused on answering questions of “How?” and “Why?” It describes the disciplines involved in analytic modeling; examines how the key criteria of parsimony and robustness help to define a good model; and discusses other Market Lett DOI 10.1007/s11002-010-9110-5 Arising from The Erin Anderson Research Conference at the Wharton School, University of Pennsylvania, October 2008 This version: January 20, 2010 A. T. Coughlan (*) Kellogg School of Management, Northwestern University, Evanston, IL, USA e-mail: [email protected] S. C. Choi Rutgers Business School, Newark, NJ, USA W. Chu Seoul National University, Seoul, South Korea C. A. Ingene The Hong Kong Polytechnic University, Kowloon, Hong Kong S. Moorthy Rotman School of Management, University of Toronto, Toronto, ON, Canada V. Padmanabhan INSEAD, Singapore, Singapore J. S. Raju The Wharton School, University of Pennsylvania, Philadelphia, PA, USA D. A. Soberman Rotman School of Management, University of Toronto, Toronto, ON, Canada R. Staelin Duke University, Durham, NC, USA Z. J. Zhang The Wharton School, University of Pennsylvania, Philadelphia, PA, USA goodness criteria, including appropriate use of analytic techniques, applicability of the model to institutionally rich, real-world problems, non-obvious results, generalizability, and ability to provide insight where other research techniques do not work. The paper defines and discusses key concepts in analytic models of distribution channels, including double marginalization, coordination, incentive alignment and contract design, strategic substitutability and complementarity, externalities, and principal–agent problems. Next, the paper summarizes research presented in the session on analytic models in channels at the Erin Anderson conference; and finally, the paper suggests avenues for future analytic modeling research.