Unlimited shelf space in Internet supply chains: Treasure trove or wasteland?

Internet retailing offers merchants limitless shelf space. This has led experts to highlight the existence of a “long tail” of offerings on the web and assert that the future of online business is “selling less of more.” However, it is difficult for Internet retailers of physical goods to sell a large scope of products without having to handle potentially large amounts of product returns from customers. This is due to the fact that customers can and do get overwhelmed by excessive product variety and often make erroneous purchasing decisions. We shed light on this issue through an assessment of theoretical predictions based on data from sales and returns of almost 7000 products in a particular product category. While retailers can benefit from expanding the scope of their inventories to generate Internet sales, the success of this strategy will depend on the control of unjustified product returns by consumers and the management of recurrent execution errors and product fit failures in transactions with customers. Furthermore, from our results, the gains that this strategy will bring to retailers will be bound by the amount of time products have been available on the Internet retailer's site, as well as by other attributes such as product price and size.     

Advance selling of new products to strategic consumers on flash sale platforms*

Flash sale (FS) is a new business model that offers discounted products in limited numbers over a short period. In this paper we discuss the impact of strategic consumers on advance selling (AS) of new products on FS platforms. We first study the impact of strategic consumers on competing retailers adopting AS to sell a homogeneous new product. And find that the retailers’ AS profits and inventory quantities decrease with the strategic customers’ valuation and valuation decreasing rate. Then we analyse whether FS can mitigate the impact of strategic customers on retailers adopting AS for new products. We consider a newsvendor model involving only one retailer adopting AS to sell a new product. We derive the results by comparing this model with two counterpart models, namely the classical newsvendor model with no strategic customers and a newsvendor model with strategic customers where the retailer does not use FS under AS.     

Inventories, Manufacturer Returns Policies, and Equilibrium Price Dispersion under Demand Uncertainty

Returns policies can prevent a manufacturer's product from being discounted. Such discounting discourages inventory holdings, and can deny adequate retail representation to products with uncertain demand. We demonstrate that returns are not simply a substitute for resale price maintenance, but can instead be employed to support a desirable degree of price dispersion at retail. Surprisingly, optimal return policies depend only on market demand functions and marginal production costs. The manufacturer need not know the distribution of demand uncertainty for its product, but can instead rely on retailers to order appropriately. Our results generalize to oligopoly settings.     

市场需求变化条件下短生命周期产品的订货策略

在短生命周期产品供应链的管理中有一个突出问题，即制造商如何制订有效的订货条件以及零售商如何利用这些订货条件进行合理订货.在市场需求变化条件下，短生命周期的产品订货分为两个阶段：第一阶段初从供应商那里订货一次．第一阶段末第二阶段初，根据市场需求变化再订货一次：本文研究了在一个产品生命周期中，在市场需求变化下，零售商和供应商如何制定有利于双方的第二次订货时间，以及考虑库存成本的零售商在两次订货中怎样采用最优的策略.     

The role of sustainable environment attributes in luxury product perceptions: Evidence from an emerging market

The social responsibility aspect of the luxury product concept has recently started to receive more attention from researchers and practitioners. However, the luxury product perceptions measurement in the literature often does not incorporate the sustainable environment friendly dimensions of the luxury goods consumption. Therefore in this study, we attempt to investigate the role of sustainable environment benefits in consumers’ value perceptions of the luxury products. Data for the study was collected from n?=?218 female consumers who were shopping in high-end luxury apparel retailers located in exclusive shopping centers in Turkey. Study results show four dimensions (exclusiveness, normative beliefs, self-directed pleasure, and social/prestige) of luxury goods perceptions of female Turkish consumers. Practical and research implications of the study findings are presented.     

Consumer evaluations of store brands: Effects of product-perceived risks

The significance of retail store brands has increased. However, despite the emergence of numerous exclusive retail products, not all of them achieved success. Seemingly, retailers have a shortsighted comprehension of the different risks related to including new categories of products to the store brands. This research analysis investigates how various categories of perceived risks connected with attributes, products, and atmosphere of stores impact consumers’ evaluation of store-branded products. A developed and tested structural model gave indications of the probability of consumers’ evaluations of store brands. The research discovered various perceptions of store brands among the respondents. Also, one of the research results found different perceptions among users and non-users of store brands.     

基于库存调剂的易逝品供应链合作利益分配问题探讨

本文将解决多人合作博弈问题的Shapley值方法用于解决两级易逝品供应链合作利益分配问题。考虑由一个供应商和两个零售商所组成的两级供应链模型,零售商与供应商不合作时,零售商根据供应商的批发价确定订货量,合作时共同决定库存,零售商之间的合作为共同决定订货量且通过库存调剂(转运)共享库存,三方合作可获最大利益,采用Shapley值法可合理分配合作利益,从而使合作更稳定。     

RESTORING THE PRINCIPLE OF MINIMUM DIFFERENTIATION IN PRODUCT POSITIONING

Most research on product positioning supports the idea of differentiation. Product standardization (i.e., minimum differentiation) occurs only under very limiting assumptions. Yet, similar products are often observed in the marketplace. We attempt to restore the case for standardization by using more realistic assumptions than in previous work. We assume that consumers consider not only observable attributes in brand choice, but also attributes that are unobservable by the firms. We find that standardization is an equilibrium when consumers exhibit sufficient heterogeneity along the unobservable attributes under both positioning with exogenously given prices and price competition, We also show that, under insufficient heterogeneity along the unobservable attribute, our results coincide with past research that argues in favor of differentiation.     

多级库存策略模拟建模

面向传统供应链结构,即由供应商、制造商、分销商、零售商、顾客市场五部分组成的供应链,研究了中心库存策略供应链管理系统的组成部分,采用了离散系统模拟建模方法对多级库存策略进行模拟建模。文章不只针对一种库存策略或单一目标的模型进行模拟,而是针对多级库存策略,从整体出发,使用BPMN对供应链的各个流程均建立了概念模型,并可以采用Arena进行实现,为建立供应链模型提供了流程化的方法,为企业进行决策提供了有力的帮助与支持。     

How much do online consumers really value free product returns? Evidence from eBay

Consumer return rates have been steadily rising in recent years, resulting in growing costs for retailers who must manage the returns process and the disposition of returned products. This cost pressure is driven in part by extremely generous return policies, such as giving consumers a full refund upon return. Interestingly, this common retail practice of full refunds is inconsistent with the recommendations of many analytical models of returns, which nearly always show that a partial refund is optimal. Such inconsistencies between theory and practice might arise when the decision drivers included in the analytical models do not match the decision drivers in practice. It might also be the case that retailers are overly optimistic about the value that consumers assign to a full refund, and thus assume that the value of such a policy outweighs its costs. In this paper, we use data collected from eBay, where identical products are sold with different return policies, to investigate these open questions in the literature. We analyze both the return policy drivers from the retailer's perspective and the return policy value from the consumer's perspective. Our results suggest that the value of a full refund policy to consumers may not be as large as one might expect, and it also exhibits a large heterogeneity across buyers with different levels of online purchase experience. In addition, we provide empirical evidence for what has long been suspected by online retailers – that a non-refundable forward shipping charge quickly erodes any value that consumers assign to return policies. The generality of our results is limited by the fact that eBay differs from traditional retail contexts in many respects, including the fact that eBay buyers may not be representative of the general buyer population. However, our study of how eBay consumers value free returns provides new insights into an understudied area, and it can serve as a starting point for future studies of the value of return policies in other retail contexts.     

生鲜食品的二级补货系统优化研究

针对连锁超市的配送网络。建立一个两级的库存系统模型，其中包括一个中心仓库和若干门店，每个门店面对的是随机的相互独立的需求，该需求服从正态分布。该库存系统是采用基于连续检测的再订货点方法管理。本文针对超市的生鲜食品补货的特征，增加对于过剩成本的考虑，采用分散库存控制权的方法，按照从门店到配送中心的思路。优化总库存成本，从而得出最佳的订购批量，同时也得出最佳的产品供给水平、再订货点等。     

具有价格干预的单产品流网络均衡

研究了由具有产能约束的多个相互竞争制造商以及面临随机需求和商品限制性价格上限的多个相互竞争零售商组成的供应链网络均衡问题。借助变分不等式理论,刻画了制造商、零售商以及消费者的最优行为,建立了供应链网络均衡模型。结合数值算例,分析了产能约束和限制性价格上限对网络均衡的影响。结果表明当政府对竞争市场实行限制性价格上限时,将造成消费市场中的商品短缺,并导致制造商和零售商的总利润减少;当存在产能限制时,将导致无价格限制的商品均衡价格更高以及消费市场中商品短缺量更大。     

Cause related marketing in New Zealand

Fundraising methods by charitable organisations are changing. Fewer collectors and increasing costs have imposed pressures on the traditional method of envelope appeals. Thus, charities have sought alternative means of gathering necessary funding. Recently in New Zealand, as in other developed countries, there has been a proliferation of charitable organisations linking with a company to raise funds. The company promises a certain monetary donation each time the product is sold. This approach is cause related marketing (CRM). From the literature it is evident that, although there are numerous trade publications discussing certain campaigns, there is a paucity of empirical research in the area of CRM. This study sought to develop an understanding of consumers' behaviour and perceptions towards this promotional activity. A majority of consumers had purchased a CRM product with some switching brands or increasing the quantity usually purchased. Overall, consumers express a favourable attitude to this form of fundraising. However, non‐purchasers in particular are more likely to agree that charities should use other methods for their fundraising. There were no significant differences in attitudes based on gender and income. Copyright © 2001 Henry Stewart Publications     

The impact of corporate social responsibility associations on trust in organic products marketed by mainstream retailers: a study of Italian consumers

This paper investigates the determinants of consumer attitudes toward organic products marketed by mainstream retailers under a private label. Since organic products are credence goods, consumers cannot directly verify whether these products comply with official standards. Organic labels are the primary source of consumer trust in organics, but these labels must be noticed and understood before consumers will actively seek them out. In that some consumers may not prioritize product labels when they shop, it is sometimes up to retailers to strengthen consumer trust. Within the antecedents of this trust, we isolated the contribution of the corporate social responsibility associations held by consumers about retailers. We surveyed Italian customers interested in organics and found that they are more likely to trust the private‐label organic products sold by a retailer when it is considered socially responsible. Our results also show that consumer trust translates into brand loyalty and a willingness to pay a premium price for organic products. Copyright © 2009 John Wiley & Sons, Ltd and ERP Environment.     

Sustainable Development of Electrical and Electronic Equipment: User‐driven Green Design for Cell Phones

Communication and cooperation with consumers are key to sustainable development. This article considers the environmental and user benefits of producing a sustainable product design that enable users' involvement and encourages the use of sustainable products to enhance environmental value. Depending on users' sensitivity to ecodesign for energy‐related products, six environment evaluation criteria may structure their perceptions of cell phone attributes (monitor, panel, battery, shell, modeling, lens and fingerprint). Innovative methods are needed for effective communication, as well as to encourage consumer participation in designing sustainable products that satisfy their needs. The design of product attributes appears able to enhance the sustainable development of products, through users' awareness of various environmental characteristics. This study thus proposes a unique method to understand product design structures and make cell phone design decisions that feature individualized designs. Copyright © 2012 John Wiley & Sons, Ltd and ERP Environment.     

Joint inventory and transshipment decisions with consumer behavioral heterogeneity

Transshipment is an effective method for reducing mismatches between supply and demand among retailers. Consumers attempting to purchase out-of-stock items may wait for transshipment, purchase at another store, or choose not to buy. In this paper, the consumer behavioral heterogeneity is characterized using the transshipment request rate and consumer switching rate. It affects the replenishment and transshipment decisions, as well as the system profits. The inventory replenishment and transshipment decisions are studied in both centralized and decentralized two-location inventory systems with consumer behavioral heterogeneity. We characterize optimal replenishment decisions in a centralized system, prove the existence of a unique Nash equilibrium in a decentralized system with a specific demand distribution, and determine the coordinating transshipment price for some decentralized systems. In numerical studies, the performance of various systems is analyzed for consumers with identical (symmetric) or differing (asymmetric) behavior between retailers. For scenarios with symmetric consumers, a higher transshipment request rate and consumer switching rate resulted in increased total profit in all systems. For scenarios with asymmetric consumers, the retailer with the higher consumer switching rate should reduce ordering in a centralized system but increase ordering in a decentralized system. Moreover, the retailer with the higher transshipment request rate reduces ordering to increase profit, whereas the other retailer increases order quantity yet earns less profit.     

Bait and ditch: Consumer naïveté and salesforce incentives

We analyze a model of price competition between a transparent retailer and a deceptive one in a market where a fraction of consumers is naïve. The transparent retailer is an independent shop managed by its owner. The deceptive retailer belongs to a chain and is operated by a manager. The two retailers sell an identical base product, but the deceptive one also offers an add‐on. Rational consumers never consider buying the add‐on while naïve ones can be “talked” into buying it. By offering the manager a contract that pushes him to never sell the base good without the add‐on, the chain can induce an equilibrium in which both retailers obtain more‐than‐competitive profits. The equilibrium features price dispersion and market segmentation, with the deceptive retailer targeting only naïve consumers whereas the transparent retailer serves only rational ones.     

Product Differentiation by Competing Vertical Hierarchies

We revisit the choice of product differentiation in the Hotelling model, by assuming that competing firms are vertically separated, and that retailers choose products' characteristics. The “principle of differentiation” does not hold because retailers with private information about their marginal costs produce less differentiated products in order to increase their information rents. Hence, information asymmetry within vertical hierarchies may increase social welfare by inducing them to sell products that appeal to a larger number of consumers. We show that the socially optimal level of transparency between manufacturers and retailers depends on the weight assigned to consumers' surplus and trades off two effects: higher transparency reduces price distortion but induces retailers to produce excessively similar products.