Pricing Strategies of Unbundling and Mixed-Bundling in a Two-Sided Market Under Stochastic Demand

2020 ◽  
Vol 37 (03) ◽  
pp. 2050016
Author(s):  
Xiaogang Lin ◽  
Yong-Wu Zhou ◽  
Qiang Lin
Keyword(s):  
Stochastic Demand ◽  
Sharp Contrast ◽  
The Other ◽  
Network Effect ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Royalty Rate ◽  
Mixed Bundling ◽  
The Impact ◽  
Two Sided Markets

We investigate the pricing strategies of unbundling and mixed-bundling for a firm that produces both a product and a compatible integrated content, respectively. The firm can be viewed as a two-sided transaction platform between sellers and customers, and decides whether to sell the product and the integrated content separately or jointly. Sellers develop independent content and are charged a per-unit royalty rate for each transaction on the platform, and customers are required to pay the prices for the product and the contents. With the consideration of stochastic demand, we study the impacts of cross-side network effect on the pricing strategies of unbundling and mixed-bundling, respectively. Moreover, we compare the impact of unbundling and mixed-bundling on the pricing strategy of the platform. Compared with no cross-side network effect, we show that the firm (with unbundling and mixed-bundling) need not subsidize customers and sellers in the presence of the effect under certain conditions, indicating that it can extract the most surplus from both sides to maximize the profit. This stands in sharp contrast to the finding of the literature on two-sided markets that the platform should subsidize one side of the market in order to make profit from the other side. Moreover, our result suggests that mixed-bundling can help the firm make more profit with fewer products by subsidizing one side of the market compared with the unbundling.

scholarly journals Competing Reverse Channels’ Performance with Sustainable Recycle Innovation Input

2020 ◽  
Vol 10 (16) ◽  
pp. 5429 ◽  
Author(s):  
Ran Liu ◽  
Bisheng Du ◽  
Wenwen Yuan ◽  
Guiping Li
Keyword(s):  
Hybrid Model ◽  
Closed Loop ◽  
Stackelberg Game ◽  
The Other ◽  
Third Party ◽  
Optimal Pricing ◽  
Pricing Strategies ◽  
Basic Model ◽  
Innovation Barriers ◽  
The Impact

Increasing attention to sustainable development issues and recycling are forcing the recyclers to use different incentives to capture more market share. Recycling innovation input is one of the effective topics in reverse competitive chains. Because of the importance of this issue, firstly, a basic closed-loop supply chain (CLSC) system is discussed that includes an integrated manufacturer and a third-party collector. Then the impact of the integration with the innovation input into third-party product collectors is considered. Eventually, two models are constructed. The first model is a basic model that includes an integrated manufacturer and one third-party collector with innovation investment. The other model is the hybrid model that includes an integrated manufacturer and two third-party collectors with and without innovation input. Stackelberg game models are used to study the optimal pricing strategies for all three models and players’ attitudes toward different scenarios. Finally, numerical analysis is presented. Our findings are generated on the following three aspects. The collector’s recycling choice, recycling innovation input, and influence on recyclers and manufacturers. It is found that the manufacturer will always choose to recycle and prefers the hybrid recycling market, which depends on the rate of collection and the compensation from production-collecting. Moreover, the results reveal that the highest return rate of recyclers occurred under the hybrid model. However, the recyclers may not be able to invest the sustainable recycle innovation input under the exorbitant innovation barriers.

scholarly journals The Impact of Price Comparison Service on Pricing Strategy in a Dual-Channel Supply Chain

2013 ◽  
Vol 2013 ◽  
pp. 1-13 ◽  
Author(s):  
Qi Xu ◽  
Zheng Liu ◽  
Bin Shen
Keyword(s):  
Supply Chain ◽  
Numerical Study ◽  
Profit Maximization ◽  
Pricing Strategy ◽  
Optimal Pricing ◽  
Pricing Strategies ◽  
Price Comparison ◽  
Dual Channel ◽  
Dual Channel Supply Chain ◽  
The Impact

Recently, price comparison service (PCS) websites are more and more popular due to its features in facilitating transparent price and promoting rational purchase decision. Motivated by the industrial practices, in this study, we examine the pricing strategies of retailers and supplier in a dual-channel supply chain influenced by the signals of PCS. We categorize and discuss three situations according to the signal availability of PCS, under which the optimal pricing strategies are derived. Finally, we conduct a numerical study and find that in fact the retailers and supplier are all more willing to avoid the existence of PCS with the objective of profit maximization. When both of retailers are affected by the PCS, the supplier is more willing to reduce the availability of price information. Important managerial insights are discussed.

scholarly journals Coordinating Demand and Supply for Crowd Logistics Platforms with Network Effect

2021 ◽  
Vol 2021 ◽  
pp. 1-14
Author(s):  
Wenjie Wang ◽  
Lei Xie
Keyword(s):  
Network Effects ◽  
Service Providers ◽  
Negative Impact ◽  
Positive Impact ◽  
Network Effect ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Demand And Supply ◽  
Direct Network ◽  
Crowd Logistics

The crowd logistics platforms connect stochastic demand with uncertain delivery supply which is provided by independent service providers. Considering direct-network effects and cross-network effects between the demand and supply side, a dynamic surge pricing model for crowd logistics platforms is built. The pricing strategy is derived to coordinate the supply with demand to equilibrium. Furthermore, the pricing strategy minimizing cumulative delivery orders is analyzed. The numerical simulation results show that the dynamic surge pricing strategies can stimulate the uncertain delivery supply for maximizing platforms’ revenue. And, direct-network effects pose a positive impact on the dynamic surge pricing strategy. In contrast, the cross-network effects have a negative impact on the pricing strategy. However, direct-network effects and cross-network effects negatively influence platforms’ revenue.

scholarly journals Pricing Strategies in Dual-Channel Supply Chain with a Fair Caring Retailer

Complexity ◽  
2019 ◽  
Vol 2019 ◽  
pp. 1-23 ◽  
Author(s):  
Lufeng Dai ◽  
Xifu Wang ◽  
Xiaoguang Liu ◽  
Lai Wei
Keyword(s):  
Supply Chain ◽  
Stackelberg Game ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Equilibrium Solutions ◽  
Channel Competition ◽  
Dual Channel ◽  
Fairness Concerns ◽  
Dual Channel Supply Chain ◽  
The Impact

Manufacturers add online direct channels that inevitably engage in channel competition with offline retail channels. Since price is an important factor in consumers' choice of purchasing channel, pricing strategy has become a popular topic for research on dual-channel competition and coordination. In contrast to previous research on pricing strategies based on the full rationality of members, we focus on the impact of retailers' fairness concerns on pricing strategies. In this study, the hybrid dual-channel supply chain consists of one manufacturer with a direct channel who acts as the leader and a retailer who acts as the follower. First, we use the Stackelberg game approach to determine the equilibrium pricing strategy for a fair caring retailer. Simultaneously, we consider a centralized dual-channel supply chain as the benchmark for a comparative analysis of the efficiency of a decentralized supply chain. Furthermore, we study pricing strategies when the retailer has fairness concerns and determine the complete equilibrium solutions for different ranges of the parameters representing cross-price sensitivity and fairness. Finally, through numerical experiments, the pricing strategies, the profit and utility of the manufacturer and retailer, and the channel efficiency of the supply chain are compared and analysed for two scenarios. We find that fairness concerns reduce the manufacturer's profits, while for the most part, the retailers’ profit can be improved; however, the supply chain cannot achieve complete coordination.

Dynamic pricing of perishable food as a sustainable business model

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Michael Scholz ◽  
Roman-David Kulko
Keyword(s):  
Willingness To Pay ◽  
Food Waste ◽  
Dynamic Pricing ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Sustainable Business ◽  
Content Type ◽  
Food Retailers ◽  
Static Pricing ◽  
The Impact

PurposeThe purpose of this paper is to (1) investigate the effect of freshness on consumers' willingness to pay, (2) derive static and dynamic pricing strategies and (3) compare the effect of these pricing strategies on a retailer's revenue and food waste. This investigation helps to reveal the potentials of dynamic pricing strategies for building more sustainable business models.Design/methodology/approachThe authors conduct an online experiment to measure consumers' willingness to pay for fresh and three-days’ old strawberries. The impact of freshness on willingness to pay is analysed using univariate tests and regression analysis. Pricing strategies are compared using a Monte Carlo simulation.FindingsThe results of this study show that freshness largely determines consumers' willingness to pay and price sensitivity. This renders dynamic pricing a promising strategy from an economic point of view. The results of the simulation study show that food waste can be reduced by up to 53.6% with a dynamic pricing instead of a static pricing strategy in the case that there are as many consumers as strawberry packages in the inventory. Revenue can be increased by up to 10% compared to a static pricing strategy based on fresh strawberries.Practical implicationsThis study suggests that food retailers can improve their revenue when switching from static to dynamic pricing. Furthermore, in most cases, food retailers can reduce food waste with a dynamic instead of a static-pricing strategy, which might help to improve their image through a more sustainable business model and attract additional consumers.Originality/valueThis study is the first to analyse the possibility of using food freshness to design a dynamic pricing strategy and to analyse the impact of such a pricing strategy on both, a retailer's revenue and a retailer's food waste.

The effects of pricing strategy on upgrade intentions

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Hsin-Hsien Liu ◽  
Hsuan-Yi Chou
Keyword(s):  
Sunk Costs ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Residual Value ◽  
Short Term ◽  
Content Type ◽  
State Orientation ◽  
Hedonic Products ◽  
The Impact

PurposeTaking a mental accounting theory perspective, this study explores how pricing strategy (all-inclusive vs partitioned) influences consumers' perceived residual value of a product and their subsequent intentions to upgrade to a newer model.Design/methodology/approachA pilot study and two formal experiments were conducted to test the hypotheses.FindingsA partitioned (vs all-inclusive) price causes consumers to later recall a lower total cost and perceive lower residual value for the existing product, thereby increasing upgrade intentions. This finding holds for both utilitarian and hedonic products. Perceived residual value mediates the impact of the pricing strategy on upgrade intentions. The pricing strategy effect is stronger for state-oriented individuals than for action-oriented individuals.Originality/valueThis study extends understanding of the impact of pricing strategies from consumers' short-term immediate demand to long-term upgrade intentions. It also identifies a previously uninvestigated moderator (action-state orientation), clarifying the boundary conditions of pricing strategy effects. The study's conceptual framework links pricing strategy, sunk costs, perceived residual value and upgrade intentions, providing rich insights and potential research paths. These findings further enhance understanding of upgrade intentions.

Negative Intra Group Network Externalities in a Monopolistic Two-Sided Market

2018 ◽  
Vol 17 (2) ◽  
pp. 51-73
Author(s):  
Gokce Kurucu
Keyword(s):  
Market Structure ◽  
Network Externalities ◽  
The Other ◽  
Pricing Strategies ◽  
Market Structures ◽  
Asymmetric Pricing ◽  
Profit Maximizing ◽  
Equilibrium Market ◽  
Two Sided Markets

Abstract This paper analyzes the optimal market structures and pricing strategies of a monopolist platform in a two-sided market where the agents on each side prefer the platform to be less competitive on their side; that is, in a market with negative intra-group network externalities. Results show that the equilibrium market structure varies with the extent of negative intra-group network externalities. If the negative network externalities are substantial, that is, if an agent’s disutility due to a larger sized market on his side is high (enough), then the profit-maximizing strategy for the matchmaker will be to match the highest types of one side with all of the agents on the other side. In that case, the matchmaker will charge a high entrance fee from the former side and allow free entrance to the agents of the latter side. However, if the network externalities are not substantial, then the matchmaker will maximize profits by matching an equal number of agents from each side. This paper thus provides an explanation of the asymmetric pricing schedules in two-sided markets when the matchmaker uses a one-program pricing schedule.

Firm Discrimination Pricing Strategies with Network Effect

2006 ◽  
Vol 532-533 ◽  
pp. 941-944
Author(s):  
Xiao Jun Pan ◽  
Hong Min Chen ◽  
Li Xu
Keyword(s):  
Social Welfare ◽  
Price Discrimination ◽  
Equilibrium Price ◽  
Network Effect ◽  
Pricing Strategy ◽  
Pricing Strategies ◽  
Uniform Pricing ◽  
Competitive Price ◽  
The Social ◽  
Differentiated Goods

We explore the price and welfare effect of price discrimination in a differentiated-goods oligopoly market with network effect and the effect of network effect on the equilibrium price, profit and output. We show that competitive price discrimination and network effect may intensify competition and the price discrimination increases the social welfare under oligopoly market with network effect. If firms differ in which markets they target for aggressive pricing strategy and competitive firm’s reaction is strong, prices in all markets may fall. So both firms agree on the strategies of setting the uniform pricing.

Modernism, Empiricism, and Rationalism

2016 ◽  
Vol 46 (1) ◽  
pp. 38-47
Author(s):  
Geoffrey Squires
Keyword(s):  
Twentieth Century ◽  
The Other ◽  
Modern Poetry ◽  
Philosophical Perspective ◽  
Irish Poetry ◽  
Dimensional Spectrum ◽  
Culture History ◽  
The World ◽  
The Impact ◽  
Rule Out

Modernism is usually defined historically as the composite movement at the beginning of the twentieth century which led to a radical break with what had gone before in literature and the other arts. Given the problems of the continuing use of the concept to cover subsequent writing, this essay proposes an alternative, philosophical perspective which explores the impact of rationalism (what we bring to the world) on the prevailing empiricism (what we take from the world) of modern poetry, which leads to a concern with consciousness rather than experience. This in turn involves a re-conceptualisation of the lyric or narrative I, of language itself as a phenomenon, and of other poetic themes such as nature, culture, history, and art. Against the background of the dominant empiricism of modern Irish poetry as presented in Crotty's anthology, the essay explores these ideas in terms of a small number of poets who may be considered modernist in various ways. This does not rule out modernist elements in some other poets and the initial distinction between a poetics of experience and one of consciousness is better seen as a multi-dimensional spectrum that requires further, more detailed analysis than is possible here.

HOME VISITS DURING THE FIRST MONTH OF DELIVERY FOR RECENTLY DELIVERED WOMEN IN UTTAR PRADESH, INDIA

2020 ◽  
Vol 6 (5) ◽  
pp. 1183-1189
Author(s):  
Dr. Tridibesh Tripathy ◽  
Dr. Umakant Prusty ◽  
Dr. Chintamani Nayak ◽  
Dr. Rakesh Dwivedi ◽  
Dr. Mohini Gautam
Keyword(s):  
Large Scale ◽  
National Level ◽  
Uttar Pradesh ◽  
Life Time ◽  
Structured Interview ◽  
The Other ◽  
Registration System ◽  
Action Group ◽  
Current Article ◽  
The Impact

The current article of Uttar Pradesh (UP) is about the ASHAs who are the daughters-in-law of a family that resides in the same community that they serve as the grassroots health worker since 2005 when the NRHM was introduced in the Empowered Action Group (EAG) states. UP is one such Empowered Action Group (EAG) state. The current study explores the actual responses of Recently Delivered Women (RDW) on their visits during the first month of their recent delivery. From the catchment area of each of the 250 ASHAs, two RDWs were selected who had a child in the age group of 3 to 6 months during the survey. The response profiles of the RDWs on the post- delivery first month visits are dwelled upon to evolve a picture representing the entire state of UP. The relevance of the study assumes significance as detailed data on the modalities of postnatal visits are available but not exclusively for the first month period of their recent delivery. The details of the post-delivery first month period related visits are not available even in large scale surveys like National Family Health Survey 4 done in 2015-16. The current study gives an insight in to these visits with a five-point approach i.e. type of personnel doing the visit, frequency of the visits, visits done in a particular week from among those four weeks separately for the three visits separately. The current study is basically regarding the summary of this Penta approach for the post- delivery one-month period.     The first month period after each delivery deals with 70% of the time of the postnatal period & the entire neonatal period. Therefore, it does impact the Maternal Mortality Rate & Ratio (MMR) & the Neonatal Mortality Rates (NMR) in India and especially in UP through the unsafe Maternal & Neonatal practices in the first month period after delivery. The current MM Rate of UP is 20.1 & MM Ratio is 216 whereas the MM ratio is 122 in India (SRS, 2019). The Sample Registration System (SRS) report also mentions that the Life Time Risk (LTR) of a woman in pregnancy is 0.7% which is the highest in the nation (SRS, 2019). This means it is very risky to give birth in UP in comparison to other regions in the country (SRS, 2019). This risk is at the peak in the first month period after each delivery. Similarly, the current NMR in India is 23 per 1000 livebirths (UNIGME,2018). As NMR data is not available separately for states, the national level data also hold good for the states and that’s how for the state of UP as well. These mortalities are the impact indicators and such indicators can be reduced through long drawn processes that includes effective and timely visits to RDWs especially in the first month period after delivery. This would help in making their post-natal & neonatal stage safe. This is the area of post-delivery first month visit profile detailing that the current article helps in popping out in relation to the recent delivery of the respondents.   A total of four districts of Uttar Pradesh were selected purposively for the study and the data collection was conducted in the villages of the respective districts with the help of a pre-tested structured interview schedule with both close-ended and open-ended questions.  The current article deals with five close ended questions with options, two for the type of personnel & frequency while the other three are for each of the three visits in the first month after the recent delivery of respondents. In addition, in-depth interviews were also conducted amongst the RDWs and a total 500 respondents had participated in the study.   Among the districts related to this article, the results showed that ASHA was the type of personnel who did the majority of visits in all the four districts. On the other hand, 25-40% of RDWs in all the 4 districts replied that they did not receive any visit within the first month of their recent delivery. Regarding frequency, most of the RDWs in all the 4 districts received 1-2 times visits by ASHAs.   Regarding the first visit, it was found that the ASHAs of Barabanki and Gonda visited less percentage of RDWs in the first week after delivery. Similarly, the second visit revealed that about 1.2% RDWs in Banda district could not recall about the visit. Further on the second visit, the RDWs responded that most of them in 3 districts except Gonda district did receive the second postnatal visit in 7-15 days after their recent delivery. Less than half of RDWs in Barabanki district & just more than half of RDWs in Gonda district received the third visit in 15-21 days period after delivery. For the same period, the majority of RDWs in the rest two districts responded that they had been entertained through a home visit.

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