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author:

Cheng, Xianghui (Cheng, Xianghui.) [1] | Deng, Shiming (Deng, Shiming.) [2] | Jiang, Xuan (Jiang, Xuan.) [3] | Li, Yanhai (Li, Yanhai.) [4]

Indexed by:

EI

Abstract:

This paper considers three promotion scenarios, namely seller-leading promotion, platform-leading promotion, and no-leader promotion, and reveals the optimal strategy and decision patterns for these three scenarios using a stylised model and lab experiments. We focus on three research questions for the seller and platform as follows: (1) Which is the optimal choice between unilateral and bilateral promotion under different promotion scenarios? (2) How will the promotion scenarios affect their joint promotion? (3) To a seller/platform, is it always better to proactively initiate promotion event? Result shows that the optimal promotion strategy varies from Seller Promotion Only to joint promotion and then to Platform Promotion Only, along with an increasing commission rate. Joint promotion is optimal only when the commission rate is moderate and when the product's list price is relatively high. The promotion scenario affects the scope and intensity of joint promotion and the profit of the entities. The joint promotion leader has the first-mover advantage, which helps him/her offer fewer coupons but obtain higher profits. To a platform or seller, launching promotion events proactively is not always the best choice. Experiments show that the subjects behaved as predicted. Moreover, the subjects demonstrate distinct decision patterns under different promotion scenarios. Ultimately, our conclusions can provide valuable decision-making guidance to marketing managers in the online marketplace. They can also choose appropriate scenarios on the basis of certain promotion objectives with knowing decision patterns under each scenario. © 2022 Elsevier B.V.

Keyword:

Decision making Electronic commerce Profitability

Community:

  • [ 1 ] [Cheng, Xianghui]School of Management, Huazhong University of Science and Technology, Wuhan; 430074, China
  • [ 2 ] [Deng, Shiming]School of Management, Huazhong University of Science and Technology, Wuhan; 430074, China
  • [ 3 ] [Jiang, Xuan]School of Business Administration, Zhongnan University of Economics and Law, Wuhan; 430074, China
  • [ 4 ] [Li, Yanhai]School of Economics and Management, Fuzhou University, Fuzhou; 350108, China

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Source :

European Journal of Operational Research

ISSN: 0377-2217

Year: 2023

Issue: 3

Volume: 306

Page: 1264-1278

6 . 0

JCR@2023

6 . 0 0 0

JCR@2023

ESI HC Threshold:35

JCR Journal Grade:1

CAS Journal Grade:2

Cited Count:

WoS CC Cited Count:

SCOPUS Cited Count: 8

ESI Highly Cited Papers on the List: 0 Unfold All

WanFang Cited Count:

Chinese Cited Count:

30 Days PV: 0

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