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Pricing decision with conspicuous customers: quick responses versus value-added services
Tianjin Univ, Peoples R China.
Tianjin Univ, Peoples R China.
Tianjin Univ, Peoples R China.
Linköpings universitet, Institutionen för ekonomisk och industriell utveckling, Produktionsekonomi. Linköpings universitet, Tekniska fakulteten.ORCID-id: 0000-0003-3058-7431
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2021 (Engelska)Ingår i: International Journal of Production Research, ISSN 0020-7543, E-ISSN 1366-588X, Vol. 59, nr 6, s. 1691-1713Artikel i tidskrift (Refereegranskat) Published
Abstract [en]

In order to eliminate the negative effects of customer strategic behaviour, retailers often adopt quick response or value-added services. While in a luxury market with conspicuous customers, retailers pricing decisions of these two strategies become more complicated. This paper studies a supply chain with a retailer serving a mixture of conspicuous and ordinary strategic customers. We develop three models so that the retailer provides (i) neither quick response nor value-added services; (ii) only quick response; (iii) only value-added services. Subsequently, we analyse the impacts of conspicuous customers on quick response and value-added services by pricing and strategy comparisons. The model further extends to the situation including both strategies. The results show that, firstly, when the proportion is less than a threshold, the retailer should adopt a low price strategy, and vice versa. Besides, the quick response could induce the retailer to adopt high price while value-added services inhibit it. Secondly, the customer conspicuous behaviour can motivate retailers to provide quick response and inhibit their value-added services. Finally, by observing the retailers decisions when they can adopt two strategies simultaneously, we find that the existence of quick response can amplify the benefits of value-added services.

Ort, förlag, år, upplaga, sidor
TAYLOR & FRANCIS LTD , 2021. Vol. 59, nr 6, s. 1691-1713
Nyckelord [en]
pricing policy; behavioural operations management; retail supply chain; conspicuous customers
Nationell ämneskategori
Transportteknik och logistik
Identifikatorer
URN: urn:nbn:se:liu:diva-164261DOI: 10.1080/00207543.2020.1724341ISI: 000514278200001OAI: oai:DiVA.org:liu-164261DiVA, id: diva2:1414289
Anmärkning

Funding Agencies|National Natural Science Foundation of ChinaNational Natural Science Foundation of China [71672121]; Independent Innovation Foundation of Tianjin University [2019XSC-0001]

Tillgänglig från: 2020-03-12 Skapad: 2020-03-12 Senast uppdaterad: 2022-10-28

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