Product Line Design And Product Return Policy Under Different Channel Structures

Both product line design and product return policy are commonly used commercial methods for firms in the process of operations and marketing,and is paid extensive at-tention to by scholars and practitioners.For product line design,it can help firms better cover different consumer segments.While for product return policy,it helps firms in-crease consumer utility,and thus increase demand,without lowering down price.How-ever,along with the coming Digital Economy Era and Big Data Era,numerous emerg-ing issues in the areas of product line design and product return policy are calling to be resolved.Thus,considering that most firms distribute their products through spe-cific distribution channels,it is quite necessary for us to analyze the emerging issues of product line design and product return policy under different channel structures.The main research contents of this dissertation are as follows:First,Chapter 3 considers how a vertically integrated firm’ s product line design can be influenced by communication strategies in a monopoly scenario.For details,through a stylized model of general communication cost,Chapter 3 develops a much more comprehensive characterization for the increasing of communication cost caused by exogenous factors.And based on this characterization.Chapter 3 shows that the firm may extend its product line when communication cost increases.This is a counter intuitive result.Chapter 3 takes into account of consumer confusion as well.Second,Chapter 4 considers the strategic interactions between channel strategy and product return policy in a b’ilateral monopoly supply channel.Chapter 4 assumes that the manufacturer needs to make decisions for its channel strategy and product re-turn policy simultaneously,and treats the refund that should be paid to consumers as a decision variable of the manufacturer and the retailer.Through a stylized game model,Chapter 4 derived equilibrium channel strategies and equilibrium product return poli-cies.Finally,Chapter 5 studies how to combine transshipment with product return to deal with demand disruption in a network distribution channel.For details,Chapter 5 develops a characterization for the disrupted stochastic demand xwhose probability distribution has an increasing generalized failure rate(IGFR)by adopting the concept of increasing variability in classical stochastic theory and applying a linear transfor-mation.Based on this characterization,Chapter 5 proposes a heuristic Transshipment-before-Buyback(TBB)contract for the manufacturer and retailers.In addition,Chapter 5 analyzes the TBB contract through a generalized Nash Bargaining game model.The dissertation mainly contributes to the literature from the following aspects.(1)Chapter 3 shows that increasing of communication cost can strengthen a firm’ s incentive to offer a long product line,even if consumer heterogeneity is very low;(2)Chapter 4 shows that adding a direct channel can strengthen a manufacturer,s incentive to cater a product return policy,and catering a product return policy can strengthen a manufacturer’ s incentive to open a direct channel;(3)Chapter 4 shows that a manu-facturer may cater a generous product return policy for direct sales,even if the return rate in direct channel is very high;(4)Chapter 5 develops a new method for the char-acterization of disrupted general stochastic demand;(5)Chapter 5 shows that,when in the presence of a buyback promise,both manufacturers and retailers have an incentive to make transshipment at a feasible arbitrary price.