Research On The Competition Strategy Of Retailers’ Double Channel Based On The Hotelling Model Under The E-commerce

With the continuous development of Internet information technology, network has been extensively used into our daily work and life. As with the e-commerce market also began to develop, more and more traditional retailers have begun to transform into double-channel retailers in order to obtain larger market share and more profits. However, there are lots of problems in the process of opening network channels. Firstly, one of problems is price competition between the traditional marketing channels and network marketing channels. Secondly, it included the problem of different degree of consumer acceptance to network channel. Thirdly, consumer purchase cost problems in traditional channels. Considering the above issues, this paper studies the competition strategy of retailers’ double channels.First of all, this paper studies competition among double-channel retailers, traditional retailers and e-commerce retailers by the use of Hotelling model and utility model. And we can make horizontal and vertical comparison research of competition between the before and after double-channel marketing respectively. The conclusion is that traditional retailers and e-commerce retailer will choose to become double-channel retailers in order to seize market share and expand their profits. Secondly, we expand the Hotelling model by introducing location decision, and through a two-stage game model, we obtain selection strategy, equilibrium price and equilibrium profit of different retailers under different channels. The conclusion is that no differences points fall within the range of linear city is the optimal location when traditional retailers compete with e-commerce retailers and double-channel retailers respectively. Finally, we analyze double channels detail strategies by the case of Suning.The research of this paper not only expands the original Hotelling model, but it also enriches the theory of retailers’ double channel in supply chain. And this article provides practical management methods and strategies for double-channel managers.