Beta Binomial Model

Marketing dictionary

Beta Binomial Model

A probability mixture model commonly used to represent patterns of brand choice behavior or media exposure patterns. The model assumes that each individual's behavior follows a Bernoulli process. That is, an individual performs some behavior of interest (e.g., buying a brand of interest) with probability p on each possible opportunity (e.g., occasion on which a purchase is made from the product category of interest). The number of times that the behavior of interest is exhibited, out of a given number of opportunities, has the binomial distribution for any individual. The model further assumes that the probability values p vary across individuals according to a beta distribution (Greene 1982; Massy, Montgomery, and Morrison 1970). A generalization of this model to represent choice among more than two items is termed the Dirichlet multinomial model. These models are used to predict future brand choice or media exposure patterns based on individuals' past behavior. Source: AMA

See: Bernoulli Process Dirichlet Multinomial Model

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