Game Theory in Advertising and Marketing Strategy: A Comprehensive Review and Empirical Exploration

Advertising and marketing involve strategic interactions among firms, consumers, and media platforms, making game theory a powerful analytical framework for understanding competitive behavior. This paper reviews key game-theoretic models applied to advertising and extends them to contemporary digital contexts, including programmatic media buying and influencer marketing. An empirical analysis of a duopolistic consumer-electronics market is conducted using a mixed-strategy Nash equilibrium framework to examine multi-channel budget allocation. The findings indicate systematic deviations from equilibrium spending, strong strategic complementarity across digital channels, and measurable welfare gains from coordinated advertising strategies. The study highlights important managerial and policy implications for data-driven and algorithmic advertising environments.