PRODUCTION AND OPERATIONS MANAGEMENT

Boiling Frogs: Pricing Strategies for aManufacturer Adding a Direct Channel thatCompetes with the Traditional ChannelKyle Cattani Wendell Gilland Hans Sebastian Heese Jayashankar SwaminathanThe Kelley School of Business, Indiana University, Bloomington, Indiana 47405-1701, USAThe Kenan-Flagler Business School, The University of North Carolina at Chapel Hill, Chapel Hill, North Carolina27599-3490, USAThe Kelley School of Business, Indiana University, Bloomington, Indiana 47405-1701, USAThe Kenan-Flagler Business School, The University of North Carolina at Chapel Hill, Chapel Hill, North Carolina27599-3490, USAWe analyze a scenario where a manufacturer with a traditional channel partner opens up a directchannel in competition with the traditional channel. We first consider that in order to mitigatechannel conflict the manufacturer, who chooses wholesale prices as a Stackelberg leader, commits tosetting a direct channel retail price that matches the retailer s price in the traditional channel.

are unaware of any comprehensive empirical study comparing prices between manufacturer-owned web sites and traditional retail locations, although a recent

Loading..

Tags:

  Operations, Management, Production, Production and operations management

Information

Related search queries