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Manufacturer driven strategic coordination as a response to “showrooming”
Decision Support Systems ( IF 7.5 ) Pub Date : 2020-04-18 , DOI: 10.1016/j.dss.2020.113305
Shounak Basak , Preetam Basu , Balram Avittathur , Soumyen Sikdar

“Showrooming”, a practice where consumers visit a brick-and-mortar store to examine and research a product before buying it online, is being increasingly observed in recent times. This not only adversely affects the physical store but also the manufacturer in the long run. Showrooming leads to reduced sales efforts on the part of the brick-and-mortar retailer which leads to a decline in showcasing of the product to consumers. This affects the overall demand for the product in the market. In this paper, we analyze the effect of wholesale prices set by the manufacturer on the retail prices of the products in a multi-channel environment affected by showrooming. To combat the adverse impact of showrooming, we further investigate the feasibility of a manufacturer-driven alliance with the brick-and-mortar retailer so that it expends adequate sales effort that leads to higher demand and a dedicated consumer base. We derive a three-parameter contract that can coordinate the channel and arrive at a win-win situation for the manufacturer and the brick-and-mortar retailer. Our analysis shows that the contract is more beneficial for a brick-and-mortar retailer with lower relative market potential. Additionally, we find that the contract brings down the retail price of the product which benefits the end consumers.



中文翻译:

制造商推动战略协调,以应对“陈列室”

近年来,越来越多地观察到“陈列室”的做法,即消费者在实体商店中访问实体商店以检查和研究产品,然后再在线购买。从长远来看,这不仅会对实体商店产生不利影响,而且还会对制造商造成不利影响。陈列室导致实体零售商的销售工作减少,从而导致向消费者展示产品的情况有所下降。这影响了市场上对该产品的整体需求。在本文中,我们分析了制造商设定的批发价格对受陈列室影响的多渠道环境中产品零售价格的影响。为了消除陈列室的不利影响,我们将进一步研究与实体零售商建立由制造商主导的联盟的可行性,以便它花费足够的精力进行销售,从而导致更高的需求和专门的消费者群。我们得出了一个三参数合同,可以协调渠道并为制造商和实体零售商达成双赢局面。我们的分析表明,该合同对于相对市场潜力较低的实体零售商更有利。此外,我们发现合同降低了产品的零售价格,从而使最终消费者受益。我们的分析表明,该合同对于相对市场潜力较低的实体零售商更有利。此外,我们发现合同降低了产品的零售价格,从而使最终消费者受益。我们的分析表明,该合同对于相对市场潜力较低的实体零售商更有利。此外,我们发现合同降低了产品的零售价格,从而使最终消费者受益。

更新日期:2020-04-18
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