Time Series Advertising Expenditure Case Study

Generic advertising is a primary method of marketing campaign for dairy Industry in North America. With declined consumers’ demand for fluid milk in Canada over time, and increasing prefrence for healthy food, in this study, the effectiveness of fluid milk advertising is evaluated using time-series demand system model of the cold, non-alcoholic beverage market in Canada. The results suggest that overall advertising is still effective for improving the demand for fluid milk, especially for standard milk, and demand for fluid milk does affect the demand for other beverages. But the advertising effectiveness across competing commodities (e.g. complements and substitutes) varies in sign from product to product. The health concerns on food safety to decide the consumption trends is still an empirical issue.  Methodology: Translog Demand System that is able to capture the nonlinear advertising effect, a two-stage time series model was estimated.

The rar file including final report, TSP code, and data file.Time Series Case Study