Thesis

Developing and evaluating targeting approaches for in-app price promotions

In contrast to a longstanding stream of literature in marketing (Mela et al. 1997; Anderson and Simester 2004), nascent analysis asserts that price promotions can be highly profitable to the firm under new business models such as freemium pricing for apps, also in the longer term (Runge et al. 2021). The main thrust of this master thesis topic is to ask: Can the firm produce even higher profits by targeting price promotions using the data commonly observed by app publishers?
To this avail, the student will obtain access to the dataset underlying Runge et al. (2021). After producing general evidence on the effectiveness of the promotion intervention, (s)he is tasked with developing their own perspectives on potential targeting approaches, drawing on marketing literature (Lattin and Bucklin 1989; Erdem et al. 2008). (S)he then is asked to evaluate the incremental effectiveness of their targeting strategy over the non-targeted promotion scheme (Dubé and Misra 2019; Hitsch and Misra 2018), to discuss their findings in detail vis-à-vis extant literature, and to develop an initial scientific contribution in marketing.
Data manipulation and analysis should be implemented in a common software for data analysis, ideally R or Python. The code should be included in the final thesis submission or be made available and referenced as an online appendix.

Literature:
C. Mela, S. Gupta, and D. Lehmann (1997). "The long-term impact of promotion and advertising on consumer brand choice." Journal of Marketing Research.
E. Anderson and D. Simester (2004). “Long-run effects of promotion depth on new versus established customers: three field studies.” Marketing Science.
J. Runge, J. Levav, and H. Nair (2021). “Price promotions for ‘freemium’ app monetization.” Available at SSRN 3357275.
J. Lattin and R. Bucklin (1989). “Reference effects of price and promotion on brand choice behavior.” Journal of Marketing Research.
T. Erdem, M. Keane, and B. Sun (2008). “A dynamic model of brand choice when price and advertising signal product quality.” Marketing Science.
J. P. Dubé and S. Misra (2019). “Personalized pricing and customer welfare.” Available at SSRN 2992257.
G. Hitsch and S. Misra (2018). “Heterogeneous treatment effects and optimal targeting policy evaluation.” Available at SSRN 3111957.