An Experiential Exercise in Bayesian Decision-Making

Abstract

Bayesian decision-making is a fundamental element of most contemporary marketing research texts. The model, in a marketing research context, serves basically to structure the components of a normative decision-making situation and to place the role of marketing research within that structure. In broader contexts, the model has been employed in a variety of marketing strategy decision areas, for examining (consumer) decision-making behavior, and so on. The experiential exercise described herein facilitates the introduction of Bayesian decision-making with the direct involvement of students in an abstract decision- making situation and by serving as a vehicle for discussion and other investigation of the Bayesian model.