Study On Information Disclosure And Supplier Selection Strategies Under The Consideration Of Consumer Responsible Preferences

With the improvement of consumer awareness of social responsibility,more and more consumers prefer to buy products or services from socially responsible firms,and are willing to pay premium for these products or services.In order to purchase suitable products,these consumers,called as responsible-conscious consumers,can engage in search activities from ambient market information,such as social networking,customer reviews,expert evaluation reports,non-governmental organization(NGO)disclosure information,to reduce uncertainty about firms before purchasing.Facing the rise of responsible-conscious consumers,different firms adopt different strategies.Downstream firms usually privately know more information about upstream supplier's responsibility level,thus can guide consumers search and purchase decision by different supplier selection and information disclosure strategies.Therefore,study on the effects of consumer responsible preferences and consumer search behavior is very essential for firms to develop their social responsible strategies.First,this paper studies decisions of information disclosure strategies and suppler selections strategies of a firm under the consideration of responsible-conscious consumers.By establishing consumer utility functions and product positioning strategy models,this paper obtains the conditions of information disclosure strategies and optimal supplier selection strategies,and the effects of information disclosure cost,consumer willingness to pay,reputation loss cost on optimal decisions.The results show that(1)when consumer willingness to pay is low,the firm may choose not to disclose any supplier information,even when such disclosure is costless.(2)With the rise of consumer willingness to pay,the frm will disclose more information.(3)When consumer willingness to pay is high,if the possiblity of choosing irresponsible supplier is high,information disclosure will have adverse effect on firm's supplier selection strategies,which makes the firm to choose dual sourcing strategy.Then,this paper examines the impact of consumer search behavior on a retailer's information disclosure and supplier selection strategies in a supply chain.This paper analyzes firm's optimal profit under exogene consumer search and endogenous consumer search behavior scenario.Our results demonstrate that(1)only when the ratio of search cost to additional willingness to pay is high enough,and retail price is intermediate,responsible consumers decide to search.(2)Consumer search behavior may lead to both consumers and the retailer worse-off.It promotes the retailer to set a higher retail price,and choose information non-disclose and irresponsible supplier strategy.(3)To some extent,consumer search behavior may weaken the retailer's incentive to disclose less information.A decrease of consumer search cost may strengthen the adverse effect of information disclosure to supplier selection strategies.In a word,by comparing the scenario of not considering consumer search,considering exogene consumer search and endogenous consumer search behavior,this paper anlyzes the impacts of consumer responsible preferences and search behavior to firm's optimal decisions.What's more,this paper obtains the optimal information disclosure and supply selection decisions,to provide some managerial insights to firm's operation decisions.