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Article

Title: Game Theory

Author: Fass, Allison Article Type: Product Analysis
Source: Forbes, v176 n10 p93(2) Publication Date: Nov 14, 2005
  ISSN: 0015-6914
  Illustrations: Output Samples
URL of Publication: http://www.forbes.com

William Bean, research director for Pepsi-Cola North America, finds vending machine use in a simulated suburban office very interesting because agents working in the office can move and interact in response to straightforward rules, but with an element of change added. In the simulation, an agent (a simulated employee), when he or she passes a vending machine in an office lobby, may or may not buy a soda. The program could be used by Pepsi to study how customers react and adapt when Pepsi changes the number and locations of vending machines in an office. Thereby, hopes Pepsi, the company will be able to more confidently choose places to put its machines. For instance, Bean has learned, by working with marketing consultant ThinkVine, that putting one vending machine in a place where people usually gather can generate 15% more sales than putting multiple machines throughout an office based on the number of people in the office. Therefore, Pepsi now urges 120 bottlers in North America to reassess their vending programs with an eye to strengthening the profitable, but slowly expanding channel. Kenneth Karakortsios, head of DecisionPower, a marketer of agent-based software, states that his software assisted Coca-Cola in effectively changing its marketing strategy in Morocco. Coca-Cola raised its marketing budget for Fanta by 40% and shifted ads for Coke from TV to radio and billboards. Coca-Cola learned that simulated consumers would pay more for Hawaii and Pom's (two Coca-Cola brands sold in Morocco), and raised prices as much as 10%.

Special Features: Output Samples

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