ANNAM An Artificial Neural Net Attraction Model to Analyze Market Shares

Systems and Modelling in Economics and Management Science’). The marketing literature so far only considers attraction models with strict functional forms. Greater exibility can be achieved by the neural net based approach introduced which assesses brands ' attraction values by means of a perceptron with one hidden layer. Using log-ratio transformed market shares as dependent variables stochastic gradient descent followed by a quasi-Newton method estimates parameters. For store-level data the neural net model performs better and implies a price response qualitatively dierent from the well-known MNL attraction model. Price elasticities of these com-peting models also lead to specic managerial implications. Keywords:Market Share Models, Attraction Models, Articial Neural Net-works