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Studies On The Service Differentiation And Pricing Strategies Of Online Retailing Supply Chain

Posted on:2014-04-26Degree:DoctorType:Dissertation
Country:ChinaCandidate:T Y DengFull Text:PDF
GTID:1269330401476669Subject:Logistics and service management
Abstract/Summary:PDF Full Text Request
Online-retailing mode of B2C shopping on website, as a mode of E-commerce, is popular in China nowadays. Online store, a brand-new shopping platform which is totally different from the traditional retail channels, is offered by online retailers for customers through the Internet, in which the customers could do shopping and paying through both stable and mobile network terminals. Online stores have not only improved the efficiency of transactions, but also saved the time and space for both customers and retailers. Online-retailing market, whose building from scratch, has been through high-speed development during the past10years, especially in recent years whose growing at the increasingly rapid speed along with the changing of the consumption habits. The total amount of online-retailing sales being pushed by the huge amount of online shoppers has reached a new high level, which has been increased at a speed of over60percent per year since2010. The development and growth of online-retailing market have result in the unprecedented low-pricing competitive situation.From the angle of supply chain management, the customers only need to pay less time and energy to compare the retail price of the same product in different online websites, which is the characteristic of online-retailing. For those online retailers who are selling the same or the similar products, using the method of low-price competition seems to be the main way to raise their own products’ demand desire, which means the price competition is much more intensely in online-retailing markets than in the traditional ones. Because the online-retailing’s gross profit is at the generally low level in China, using the method of markdowns excessively frequently not only reduces consumers’ loyalty for online retailers, but also reduces the online-retailers’ profit significantly. In order to acquire more profit, most online-retailers choose to reduce the wholesale price of products and the cost of express delivery, which results in the intense relationship between the members of online-retailing supply chain, also reduces the possibility of their cooperation. Meanwhile, reducing the express delivery cost also lowers its service quality, and then the customers do fewer shopping, which no doubt leads to creating less profit for online-retailers.As described above, the author of this dissertation considers the differentiation competition as the new orientation of online-retailing competition. Attributing to the price competition in the online-retailing’s similar with Bertrand price competition model, which shows the oligopoly firms of price competition are forced to determine their final price on the level of their own marginal cost and results in the Bertrand Paradox. Taking into the account that there are three basic pivotal assumptions existed in this model:firstly, production of homogeneous products; Secondly, two firms with enough production powder are existed in the market; thirdly, the game played between the two firms.This dissertation tries to widen these three basic assumptions to find the methods to deal with the Bertrand Paradox, one approach is product differentiation strategies, which help the supply chain members to break the Bertrand Paradox and avoid the frequent price war.On the other side, the service product as represented by the delivery service can also be the significant method for the members of online-retailing supply chain to acquire the advantages in differentiation competition. How to choose the service quality level to offer the customers for acquiring the pricing advantages and avoiding the frequent price war in order to realize the aim of profit maximum is also the key point which should be paid attention to by both online-retailing industry and the service management researchers.The main research content is:based on the comprehensive grasping of the service products’characteristics, the author build up the models of consumer utility and market demand separately, use the game theory as the technical method to discuss the influence accused by the differentiation strategies used by the online-retailing members, and provide the decision-making references for those members. The specific study contains four chapters, as following goes:Chapter3studies how the producers’ differentiation strategies influence the whole online-retailing supply chain and proposes the optimal strategies for the network retail supply chain members when model’s equilibrium is achieved. Chapter4studies under the condition of product homogeneity, how the service strategies of online-retailers affect the whole online-retailing supply chain and puts forward the optimal strategies for the network retail supply chain members when model’s equilibrium is achieved. Chapter5studies how the online-retailers’different service strategies influence the whole online-retailing supply chain under the circumstance of the certain degree of product differentiation. Chapter6does the study on the influence the online-retailers’differentiation strategies bring to the whole online-retailing supply chain under the competitive circumstance and proposes the optimal strategies for the network retail supply chain members when model’s equilibrium is achieved.The main conclusions of this dissertation could widen the analysis angles, richen the theoretical system and research areas of the online-retailing supply chain management, the specific implications for study are reflected in the following three aspects:Firstly, the study exposes what kind of impacts the service differentiation strategies bring to the total profit of online-retailing supply chain and the pricing behavior of supply chain’s members; Secondly, the study exposes that how the members of supply chain formulate the differentiation strategies to maxim their profit based on their characteristics; Thirdly, the conclusions shows the members of online-retailing supply chain how to avoid the frequent price war through the differentiation strategies in order to increase their profitability.The innovation of this dissertation contains the following three aspects:(1)The study is carried out from the perspective of supply chain management. Previous literatures generally did the studies from the angle of industrial economy, the focuses always lied in choosing the entering timing for the enterprises and making the competition strategy, but in this dissertation, the study is carried out from the perspective of competition and cooperation between the members of supply chain, focuses on how the service differentiation strategies influence the pricing and profitability of supply chain members.(2)In view of historical literatures ignored the particularity of service products in terms of cost and utility, this study introduces two brand-new variables: consumer utility and consumer preferences, which are the base for building the product market demand model under the conditions of different manufacturers’ service quality, this innovation exposes clearly the influence mechanism that the level of service quality and customer preference affect online-retailing supply chain members’pricing behavior and profitability. (3)The dissertation discusses how the online-retailers make the differentiation competition strategies of service and how those different strategies influence the members of supply chain under the circumstance of the certain level of product differentiation. By reviewing the historic literature, fewer mentioned the differentiation competition behavior and the influence it brings to the profitability of the supply chain members. This dissertation builds up the model of product market demand, and studies the interaction influence between the level of product differentiation and the level of service differentiation on the base of this model, in order to present the reference recommendations for the online-retailers when they are making the differentiation competitive strategies of service.
Keywords/Search Tags:Supply chain management, Online-retailing, Differentiationcompetition, Game theory, Pricing strategies
PDF Full Text Request
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