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I have designed and tested a time series model where I am able to examine the impact of various marketing channels on dependent variables (Such as sales, revenue, website traffic, etc).

The model has helped me identify channels that have a strong correlation with the dependent variable(s) and channels that that have little to no impact. I have also identified the point of diminishing returns for each channel. Using this model, I am able to optimize my media spend and properly allocate my money to optimize my goals.

The problem: I'd like to run a simulation before I begin changing how I allocate my media spend. Lets say I identify a channel that is worthless and I want to use that money in different marketing channels (keeping in mind the point of diminishing returns). I'd like to take do a forecast of how the my changes in media spend will impact my dependent variable (Sales, Website Traffic, etc).

How can this be done??

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what you might consider is doing a monte carlo where your predictor series can either be specified or simulated. Forecasts can then be made resulting in a family of forecasts for each forecast period for the output series.

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  • $\begingroup$ If you are happy with my response please accept it to close the question $\endgroup$ – IrishStat Aug 15 at 8:22

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