Dynamic optimal control model for profit maximization of software product under the influence of promotional effort

In this paper, a decision model is presented for the sales of software product to determine the profit and marketing policy under the influence of promotional efforts. The paper focuses on dependence of the optimal profit on the promotional efforts when there is diffusion effect of demand on the sales function. An elaborate optimization policy considering the dynamic nature of production cost function is proposed and numerical example is illustrated. The paper also studies the behavior of the future profit and its impact on profit maximization model by considering the constant price during the entire planning horizon. The experimental results greatly help us to identify the contributions of each selected parameter and its weight. Some conclusions, limitations of this study and future direction are also discussed.