Research On Retailers’ Pricing Strategies For Extended Warranty Service Under The Channel Competitive Scenario

With the intensification of product competition in the market and the further compression of product profit space,enterprises focus on developing new productbased value-added services to maintain profit growth.Extended warranty service is a kind of value-added service with high profit margin.It can not only meet the needs of consumers for product quality assurance,but also bring new profit growth space for enterprises.Therefore,as an important supplementary service,extended warranty service has become an important tool for enterprises to consider and use in response to the above problems.As a link of direct contact with consumers in the supply chain,the importance of retailers has become increasingly prominent.In addition,with the increasingly mature market,retailers will encounter multiple channel competition scenarios when providing extended warranty services in the supply chain.In addition to product retailers,manufacturers and many third-party enterprises have also joined the extended warranty service market through online and offline channels.These enterprises compete with retailers in terms of channels,service prices and service quality.Therefore,for retailers whose goal is to maximize profits,facing different channel competition scenarios,it is particularly important to establish appropriate extended service prices.For the channel competition scenario of manufacturers,this thesis constructs the model that only retailers provide extended warranty service and the model that retailers compete with manufacturers to provide extended warranty service,and uses the optimization theory and reverse induction method to solve the optimal extended warranty service pricing strategy that maximizes retailers’ profits.Secondly,the sensitivity of consumers to the price of extended warranty service and the influence of channel preference on the price of extended warranty service and retailers’ profit are analyzed through parameter analysis and numerical experiments.The conclusion is as follows: when consumers’ sensitivity to the price of extended warranty service increases gradually,retailers should reduce the price of extended warranty service.The higher the consumer’s preference for retailers’ channels,the more profits retailers will gain.Therefore,retailers can choose to provide corresponding extended warranty service for consumers with different needs.For the price competition scenario of the third party,this thesis constructs the model that only the third party provides the extended warranty service and the model that retailers compete with the third party to provide the extended warranty service,and uses the optimization theory and reverse induction to solve the optimal extended warranty service pricing strategy that maximizes the retailer’s profits.Secondly,through parameter analysis and numerical experiments,the sensitivity of consumers to the price of extended warranty service and the impact of the price competition intensity of extended warranty service on the price of extended warranty service of retailers are analyzed.The conclusion is as follows: Retailers can obtain more profits by providing extended warranty service.When consumers’ price sensitivity of extended warranty service gradually increases,the best strategy for retailers is to reduce the price of extended warranty service.When the competitive intensity of extended warranty service price increases,retailers can appropriately increase the price of extended warranty service.For the price and service quality competition scenario of the third party,this thesis constructs the model that only retailers provide extended warranty service and the model that retailers compete with the third party to provide extended warranty service,and uses optimization theory and reverse induction to solve the optimal extended warranty service pricing strategy that maximizes retailers’ profits.Secondly,through parameter analysis and numerical experiments,this thesis analyzes the impact of extended warranty service quality,consumers’ sensitivity to extended warranty service quality,and the competitive intensity of extended warranty service quality on retailers’ extended warranty service pricing.The conclusion is as follows: in the face of fierce competition in the market environment,retailers can obtain more bargaining power by providing higher quality extended warranty service.When consumers are highly sensitive to the quality of extended warranty service,the best strategy of retailers is to improve the quality of extended warranty service while increasing the price of extended warranty service.When the competition intensity of extended warranty service quality is large,the best strategy of retailers is to reduce the price of extended warranty service.The research content of this thesis is in line with the actual competitive situation faced by retailers in the supply chain.It analyzes the consumer preferences,the sensitivity of consumers to the pricing and quality of extended warranty service,and the impact of the price and quality of extended warranty service on the optimal pricing strategy of retailers.It provides theoretical basis for the pricing strategy of extended warranty service when retailers face channel competition in the actual market.