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ABSTRACTThe global economy is transitioning from product economy to service economy, and the optimization of product line with value-added services is one of the important issues faced by enterprises. Therefore, this paper studies the pricing optimization of product line with value-added services considering consumer choice behavior. First, we apply the multinomial logit (MNL) model to simulate consumer choice behavior, and establish a MNL-based product line pricing optimization model considering value-added services. Then, the optimal pricing strategies for products and services are solved for three different scenarios: single product with service, homogeneous products with services, and heterogeneous products with services. Finally, through numerical experiments, we analyze the changing trends of the optimal pricing, market share and profit of products line with value-added services with some impact factors, such as product quality, service level, consumer sensitivity, and number of products under three different scenarios. We also obtain some managerial implications when an enterprise develops product line with value-added service.

Price anchoring and online reviews are prominent features in the customer purchasing process on the platform. These factors adjust customer cognition and significantly impact their choice behavior, ultimately affecting product rollover strategies. Focusing on the product single rollover, this study develops a multistage dynamic pricing and attribute optimization model based on online reviews and price anchoring effect. We explore dynamic pricing, product exit strategies, attributes optimization, and product rollover strategies. The study shows that considering price anchoring effects usually results in firms achieving higher profits compared to when they ignore this factor. As a result, skimming and penetration pricing strategies emerge as preferred strategies for current product dynamic pricing. However, excessively low prices for current products may diminish profits from upgraded products after product rollover, prompting firms to carefully balance current product pricing with upgraded product sales. Additionally, two threshold conditions are obtained, which can determine the priority of attribute improvement and the total quantity of optimized attributes. Counterintuitively, as consumer willingness to pay rises, firms may reduce their innovation efforts. Furthermore, we expanded the product rollover framework and derived sufficient conditions and optimal strategies to adopt dual rollover. The research findings provide theoretical foundations and decision-making support for the product rollover and marketing strategies of innovative enterprises.

Products exhibit network effects when the utility a customer obtains from buying a product depends not only on its attributes but also on the sales of the same or similar products. In this article, we study product line optimization problem considering network effects. We first characterize consumer choice model considering network effects. Then we investigate the product line optimization problem under such model. In the homogeneous case with the same products, we find that the optimal choice probabilities and optimal prices may be different for each product. In the heterogeneous case with different products, there is at most one product that takes the “high” market share while all the other products take “low” market share. In particular, when only the network effects are heterogeneous, the larger the network effect, the lower the optimal pricing and the higher the market share. Through numerical experiment, finally, we demonstrate the importance of considering network effects and test the robustness of solutions.