A MIXED INTEGER NONLINEAR OPTIMIZATION MODEL FOR POSITIONING A PRODUCT IN A MARKET WITH RISK

This is a marketing problem faced by a firm which wishes to position a new brand product in an existing product class. Individuals usually differ in their choice of an object out of an existing set, and they would also differ if asked to specify an ideal object. The aim of the problem considered is to optimally design a new product in order to attract the largest number of consumers. This paper addresses a mixed integer nonlinear programming model to formulate the positioning problem. A direct search approach is proposed to solve the model. A computational experience is presented.