The effect of entrant brand's ownership on national brands' positioning strategies

National brand manufacturers face the threat of new product entry from not only their traditional competitors (other national brand manufacturers) but also from their own customers (the retailer). We compare how national brands can limit the loss due to entry of these two types of entrants by positioning of their brands. Our results show that national brands position farther from one another when the new entrant is a store brand than when the entrant is another national brand. We also find that due to different positioning strategies of these two types of entrant brands—the entrant store brand positioning “in‐between” incumbent national brands whereas the entrant national brand positioning “away” from incumbent national brands—incumbent national brands may lose more from the entry of a weaker store brand than from the entry of a stronger national brand. Finally, we find that taking into consideration both pricing and product positioning decisions, consumer and social welfare are generally higher from store brand entry than from national brand entry.     

A Study of Vertical Integration and Vertical Divestiture: The Case of Store Brand Milk Sourcing in Boston

This article investigates whether a retailer’s store brand supply source impacts vertical pricing and supply channel profitability. Using chain‐level retail scanner data, a random coefficients logit demand model is estimated employing a Bayesian estimation approach. Supply models are specified conditional on demand parameter estimates. Bayesian decision theory is applied to select the best fitting pricing model. Results indicate that a vertically integrated retailer engages in linear pricing for brand manufacturers’ products while competing retailers make nonlinear pricing contracts with brand manufacturers for branded products and store brands. A simulated vertical divestiture based on real world events provides evidence for improved channel efficiency.     

基于制造商服务的供应链竞争策略分析

本文以一个具有两家制造商和一家零售商组成的供应链结构为研究对象,探讨了制造商向顾客提供服务的重要性,并着重分析了在零售商占据市场优势的情况下,制造商的定价与服务策略,以及零售商制定产品零售价格时要考虑的主要因素,其结果对企业在供应链体系中制定经营策略具有一定的帮助。     

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.     

“When Should Manufacturers Want Fair Trade?”: New Insights from Asymmetric Information when Supply Chains Compete

We study a model of competing manufacturer/retailer pairs where adverse selection and moral hazard are coupled with promotional externalities at the downstream level. In contrast to earlier models mainly focusing on a bilateral monopoly setting, we show that with competing brands a ‘laissez‐faire’ approach towards vertical price control might not always promote productive efficiency. Giving manufacturers freedom to control retail prices is more likely to harm consumers when retailers impose positive promotional externalities on each other, and the converse is true otherwise. Our simple model also suggests that, with competing supply chains, consumers and manufacturers might prefer different contractual modes if promotional externalities have substantial effects on demands.     

Optimal joint trade-in rebate strategies in a retailer-led supply chain

This study investigates the joint trade-in rebate strategies in a supply chain with independent manufacturers selling substitutable products via a dominant retailer. We model their interplay as a Stackelberg game and analyze their joint trade-in rebate decisions. We find that the differentiated trade-in rebate scheme is better for the retailer, and the manufacturers cooperating in making their trade-in rebate decisions can achieve win-win results in most cases. However, replacement consumers could benefit from the retailer's uniform trade-in rebate scheme and the manufacturers not cooperating in their trade-in decisions. The latter is always more beneficial to the 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.     

网络零售商惠顾意愿影响因素及作用机理

本文在回顾相关研究文献和访谈基础上,构建了网络零售商惠顾意愿影响因素及作用机理模型,并对该模型进行实证检验。研究结果表明:网络零售商惠顾意愿是多种因素共同作用的结果,网络零售商惠顾意愿与惠顾行为之间呈正相关关系;网店印象、网店信誉、网站服务特征和顾客风险偏好对网络零售商惠顾意愿具有直接正面影响,同时这四个因素也会通过感知风险间接影响网络零售商惠顾意愿,感知风险与网络零售商惠顾意愿之间呈负相关关系。     

Direct Marketing in Oligopoly

We consider a game in which symmetric manufacturers decide whether to set up sites (e.g., web sites) where consumers can buy their products directly. Following this decision, the manufacturers choose quantities to sell to the retailers, and then the manufacturers with direct‐sales sites and retailers choose quantities to sell to the consumers. We show that since an increase in the number of retailers may drive the direct‐selling manufacturers from the retail market, it may raise the retailers’ profit and reduce social welfare. Finally, we discuss two cases: an oligopolistic wholesale market and a market with price competition and differentiated products.     

Creating consumer durable retailer customer loyalty through order fulfillment service operations

Manufacturers now find themselves in the position of finding new ways to remain competitive in the era of retail power. The onus rests on the manufacturer's ability to implement operational strategies that help the retailer achieve its objectives. Specifically, manufacturers that establish successful order fulfillment service can affect retailer loyalty. The overarching goal of this research, therefore, is to examine the importance to operations managers of understanding the order fulfillment needs and expectations of their retail customers and to establish the value-added role that operations management plays in developing retailer loyalty. Empirical evidence is provided on the relationships between relational order fulfillment service, operational order fulfillment service, satisfaction, affective commitment, purchase behavior, and loyalty. Such evidence not only focuses on the strategic importance of the OM discipline in manufacturer–retailer relationships, but also extends previous OM theory by taking a more complex view of the loyalty phenomenon.     

Sales by multi‐product retailers

This paper examines the rationale underlying periodic price promotions, or sales, for perishable food products by supermarket retailers. Whereas previous studies explain sales in a single‐product context as arising from informational, storage cost, or demand heterogeneity, this study focuses on the central role of retailers as multi‐product sellers of complementary goods. By offering a larger number of discounted products within a particular category, retailers are able to attract a sufficient number of customers to offset the effect of lower margins on sale items by selling more high‐margin items. The implications that emerge from the resulting mixed‐strategy equilibrium are tested in a product‐level, retail‐scanner data set of fresh fruit sales. Hypotheses regarding the rationale and effectiveness of sales are tested by estimating econometric models that describe (1) the number of sales items per store, (2) the depth of a given sale, and (3) promotion effectiveness on store‐level demand. The results of this econometric analysis support the hypothesis that the breadth and depth of price promotions are complementary marketing tools, thus explaining how EDLP and HI‐LO store formats can exist in the same monopolistically competitive market equilibrium. Copyright © 2006 John Wiley & Sons, Ltd.     

Manufacturer collusion: Strategic implications of the channel structure

We investigate how the structure of the distribution channel affects tacit collusion between manufacturers. When selling through a common retailer, we find—in contrast to the conventional understanding of tacit collusion that firms act to maximize industry profits—that colluding manufacturers strategically induce double marginalization so that retail prices are above the monopoly level. This lowers industry profits but increases the profit share that manufacturers appropriate from the retailer. Comparing common distribution with independent (exclusive) distribution, we show that the latter facilitates collusion. Despite this result, common retailing leads to lower welfare because a common retailer monopolizes the downstream market. For the case of independent retailing, we also demonstrate that contract offers that are observable to the rival retailer are not necessarily beneficial for collusive purposes.     

Resale price maintenance in a model of consumer search

A retail search model of Salop and Stiglitz (1977) is adapted to analyze manufacturer incentives for resale price maintenance. For some retailer cost functions and distributions of consumer search costs, imposition of a minimum price for retailers causes a price distribution to collapse to an intermediate price. Manufacturers may benefit from price floors when sales to high-search-cost consumers that have obtained lower prices increase sufficiently so as to offset decreased sales to other consumers facing higher prices. In contrast to previous work, no free-riding problem with respect to dealer services is necessary for manufacturers to prefer banning discounting of their products.     

Information and profit sharing between a buyer and a supplier: Theory and practice

This paper is about aspects of an optimal relationship between 2 firms, a supplier and a retailer, in a 2‐party supply chain. The focus is on sharing private information when demand uncertainty exists so as to better coordinate the supply chain. It draws inspiration from a real case in Ireland of a new fish‐processing company, Oceanpath, and a supermarket chain, Superquinn, in which information was shared. The argument is that sharing the retailer's information increases supply chain profit, as well as benefiting consumers. Profit sharing will be needed to guarantee that both the retailer and the supplier gain when information is shared.     

Competition Between Online and Physical Stores: The Implications of Providing Product Information by Pure‐Play E‐tailer

This paper studies the competition between a single pure‐play e‐tailer and a bricks‐and‐mortar retailer, which are originally spatially differentiated. By utilizing information and communication technology, a pure‐play e‐tailer can strategically control consumers' disutility for online purchase. However, such an action may also raise consumers' motivation to visit the physical store, which causes free‐riding by the bricks‐and‐mortar retailer. We show that in the presence of a high free‐riding effect, the e‐tailer should be willing to provide information only about ‘niche’ products, which also results in improving the welfare of all members in the market. Copyright © 2011 John Wiley & Sons, Ltd.     

论商店印象对消费者行为的影响

商店印象对消费者购物行为有重要的影响,尤其当消费者面对零售商提供类似商品或服务的商店时,消费者通常会通过其心中的商店印象来决定其光顾的对象。     

The role of physical distribution services as determinants of product returns in Internet retailing

Pressure continues to build on Internet retailers to squeeze out inefficiencies from their day-to-day operations. One major source of such inefficiencies is product returns. Indeed, product returns in Internet retailing have been shown to be, on average, as high as 22% of sales. Yet, most retailers accept them as a necessary cost of doing business. This is not surprising since many retailers do not have a clear understanding of the causes of product returns. While it is known that return policies of retailers, along with product attributes, are two important factors related to product return incidents, little is known about which aspects of the online retail transaction make such a purchase more return-prone. In the current study, we seek to address this issue. We use a large data set of customer purchases and returns to identify how process attributes in physical distribution service (PDS) influence product returns. The first attribute involves perceptions of scarcity conditions in inventory availability among consumers when retailers reveal to consumers information on inventory levels for the products that they intend to buy. Our results show that orders in which items are sold when these conditions are revealed to shoppers have a higher likelihood of being returned than orders in which these conditions are not revealed. While prior research has argued that inventory scarcity perceptions have an effect on purchases, our findings suggest that they are also related to the likelihood of these purchases being returned. The second attribute involves the reliability in the delivery of orders to consumers. We find that the likelihood of orders being returned depends on the consistency between retailer promises of timeliness in the delivery of orders and the actual delivery performance of the orders. Moreover, we find that the effect that consistency in the delivery has in the likelihood of returns, is stronger for orders that involve promises for expedited delivery than for orders with less expeditious promises. That is, although the occurrence of returns depends on the delays in the delivery of orders to consumers relative to the initial promises made by the retailers, this effect is more notable for orders that involve promises of fast delivery.     

Bailing on the Car That Was Not Bailed Out: Bounding Consumer Reactions to Financial Distress

We examine how consumers react to the financial distress of durable goods manufacturers by studying the Swedish new car market. We employ a difference‐in‐differences matching methodology whereby we compare sales of carmaker Saab with those of a control group of substitute products. To account for possible substitution between products in the treatment and control groups, we propose and apply bounds to our difference‐in‐differences matching estimator. We then refine the bounds and provide conditions under which they depend only on product elasticities. We find that there was a significant decrease in the sales of Saab following its filing for administration.     

Sustainable Retailing – Influencing Consumer Behaviour on Food Waste

The aim of this research was to examine the influence of a UK national retailer on its customers' food waste behaviour. Using six communication channels (in‐store magazine, e‐newsletter, Facebook site, product stickers and in‐store demonstrations), Asda presented standard food waste reduction messages to its customers during two time limited periods in 2014 and 2015. Six national surveys over 21 months tracked customers' self‐reported food waste. Our results showed that the combined communication channels and repeated messages over time had a significant effect on reducing food waste of customers. Surprisingly, customers who said they did not recall seeing the messages also reduced their food waste, showing the wider influence of interventions. Those who saw a food waste reduction message saved an estimated £81 annually from reducing food waste. The main conclusion of this paper is that retailers can influence the pro‐environmental behaviour of customers using conventional communication channels; however, repeat messages are needed in order to have a long‐term impact. © 2017 The Authors. Business Strategy and the Environment published by ERP Environment and John Wiley & Sons Ltd     

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.