Research On The Retail Facility Location For New Product Under Social Contagion Effect

The location of retail facilities plays a vital role in retail management.For this kind of location problem,it is critical to properly measure and characterize market demand.However,the life cycle of a new product is often limited,and within that limited time horizon,its sales is dynamically influenced by multiple factors such as word-of-mouth,marketing and distribution support.In addition,with the rapid development of society,consumers begin to pay more attention to service quality and experience processes,their demand characteristics become more prominent in terms of personalization and differentiation,and individual behavior decisions are increasingly interdependent.All of the above make the location decision of retail facilities more challenging.Therefore,it is of great significance for retailer to further study the retail location problem and formulate a more effective location model.Based on the individual level of consumers,this thesis proposes a joint decision-making model for retail facility location and level optimization in the presence of social contagion effects caused by the firm’s marketing strategies and word-of-mouth communication among consumers as well as individual heterogeneous behavior.And a solution method combining the two-stage tabu search algorithm and multi-agent simulation technology is designed and implemented.Then,a series of numerical experiments are conducted from three aspects: the validation of model’s validity,the impact of social network structure and the impact of parameter changes,and some insights are provided on the results of the solution.The research results demonstrate that taking the social contagion effect into the decision-making of retail facility location can achieved a significant improvement in the expected profit of the retailer.Moreover,for different social networks structures or products with different life cycles,the retailer’s location strategy should be different.Considering the actual environment of the retail market,themodel is also extended to the competitive market,and relevant numerical experiments as well as results analysis were performed.Finally,some prospects and suggestions for the future research directions are put forward.