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Channel structure and differential pricing strategies in dual-channel e-retail considering e-platform business models
- Source :
- IMA Journal of Management Mathematics. 32:91-114
- Publication Year :
- 2020
- Publisher :
- Oxford University Press (OUP), 2020.
-
Abstract
- Although online business has been growing for some time, third-party e-platforms and their impact on e-channels are an under-explored area in the literature on dual-channel supply chains. Considering different combinations of open and self-support e-platform, this paper develops dynamic game models in four dual-channel e-retail structures to study pricing strategies and channel preference for manufacturers. The results provide interesting insights. First, a manufacturer’s optimal prices vary in different e-channels. Second, e-retail prices on the self-support e-platform and open e-platform are both affected by the e-platform’s service quality and commission fee. Regardless of the channel structure, a better service quality by one e-platform leads to an increase in its own e-retail prices and forces the competing e-platform to either improve its service quality or take a lower price. Lastly and more importantly, we compare the manufacturer’s pricing strategies and performances in different dual-channel e-retail structures and identify its preferences. Specifically, if the commission fee is dynamic, we find that the manufacturer always prefers to use two e-channels provided by different e-platforms, and at least one of the e-channels is the self-support model, although it is a sub-optimal strategy.
- Subjects :
- 021103 operations research
Applied Mathematics
Strategy and Management
0211 other engineering and technologies
Structure (category theory)
02 engineering and technology
Management Science and Operations Research
Business model
Topology
Management Information Systems
Dual (category theory)
03 medical and health sciences
Differential pricing
0302 clinical medicine
Modeling and Simulation
030221 ophthalmology & optometry
Business
General Economics, Econometrics and Finance
Communication channel
Subjects
Details
- ISSN :
- 14716798 and 1471678X
- Volume :
- 32
- Database :
- OpenAIRE
- Journal :
- IMA Journal of Management Mathematics
- Accession number :
- edsair.doi...........8744e20b72e33d50d75f0ebc81c744c6