The Study of Strategy of Persuasive Advertising Investment

This paper develops the model of advertising investment with game theory, studies the advertising investment strategy of two companies separately in duopoly, and gives theory support for doing investment in advertising of enterprise. With the persuading effects of advertisement, enterprise makes products different professedly through advertising activity in order to persuade consumers to spend more money buying those products with higher price. This paper provides strategy of advertisement investment in the simultaneous-move game and judge from the results of comparing the result got from the paper with the result of Cournot equilibrium. The paper concludes that enterprises have possibilities of advertising by the influence of the efficiency factor. Otherwise the investment will consume the profits rather than make profits for the enterprise. Meanwhile we analyze the influence on profits, which is put by the efficiency factor in making price