Selling format selection of dual-purpose retail platform in competitive environment
The rapid development of major retail platforms has enabled them to have more power in the market,with Taobao,JD,Pinduoduo and other retail platforms becoming the primary choice for large number of consumers.The unique advantages of platform channels have prompted numerous manufacturers to change their previous single channel structure and actively cooperate with major mainstream retail platforms to cater to the diverse needs and consumption habits of consumers.For example,Xiaomi,Midea,Panasonic,Lenovo and other brands have established sales channels on retail platforms such as Taobao,JD,Pinduoduo and Amazon,but the selling format implemented by these brands varies considerably.In this context,the question of which selling format should be adopted by retail platforms to sell the manufacturer's goods has become an urgent issue.For retail platforms,there are two popular and commonly used selling formats,namely the reselling format and the agency selling format.In the reselling format,the retail platform first buys products from manufacturers at a wholesale price and then resells them to consumers.For instance,JD's own self-supporting store resells manufacturers'products.The manufacturers rely on the huge customer traffic of JD to advertise their products on JD's store page and then produce them according to the order quantity of the platform,with unified storage and distribution by JD's own platform.In the agency selling format,manufacturers establish online stores through the platform's agency channel,leveraging a range of services provided by the platform to directly sell their products to consumers.However,manufacturers are obligated to pay a certain commission fee to the platform for these services.In recent years,however,many companies have gone beyond just maximizing profits as their sole goal,instead,they have actively improved the welfare of their stakeholders and enhanced their own public image by taking on CSR(Corporate Social Responsibility).For example,Pinduoduo sends products sold on his platform to a third party company for sampling and inspection,and also takes responsibility for free shipping,shipping insurance,and no-reason returns.Additionally,Pinduoduo also cooperates with over 100 well-known brands,domestically and abroad,to promote brands in rural areas and ensure consumers to receive high-quality goods at affordable prices.The impact of this change in strategy on the choice of retail platform's selling format and the supply chain members'optimal decision has not been fully considered.Consequently,based on the exogenous definition of CSR behavior,this paper considers CSR behavior as the concern for consumer surplus and adopts a dual-purpose form in the objective function that takes into account both self-interest and consumer interest.The impact of this dual-purpose strategy on the choice of retail platform selling format,the optimal decision of all supply chain members and the overall performance of the supply chain in a competitive environment is explored.In order to solve this problem,this paper employs the game theory approach to construct a two-level supply chain model consisting of one manufacturer and two retail platforms,in which the manufacturer and one of the retail platforms pursue the maximization of their own profits,and the other retail platform seeks the maximization of a linear combination of his own profit and consumer surplus,i.e.,considering the dual-purpose optimum.Specifically,a total of four scenarios are considered in which the two retail platforms can choose either the reselling format or the agency selling format respectively.Then,the backward induction method is used to find the equilibrium solutions in each scenario.Through comparative analysis and numerical analysis,the following conclusions are finally obtained:First,the optimal decision of the dual-purpose retail platform is to choose the reselling format when the competitor chooses the reselling format,while the optimal decision of the dual-purpose retail platform is still to choose the reselling format when the competitor chooses the reselling format in most cases.However,if the market is moderately competitive at this time and the dual-purpose retail platform cares more about consumer surplus,the platform should choose the agency selling format.It is also found that the dual-purpose retail platform can earn higher profits than his competitors under certain conditions;Second,when both the dual-purpose retail platform and its competitors choose the reselling format,both platforms are able to obtain the optimal profits,but the manufacturer earns the lowest profits.When the dual-purpose retail platform's concern for consumer surplus and the intensity of market competition are in different ranges,the manufacturer will obtain the optimal profits when the dual-purpose retail platform's competitors choose the agency selling format,while if the dual-purpose retail platform chooses the reselling format at this time,both retail platforms can obtain the sub-optimal profits under certain conditions;Third,in an environment where two retail platforms compete,when the dual-purpose retail platform chooses the reselling format to sell the manufacturer's goods,the overall profits of the supply chain rise with the dual-purpose retail platform's concern for consumer surplus regardless of whether the dual-purpose retail platform's rival chooses the reselling or agency selling format.This indicates that the dual-purpose strategy adopted by the retail platform can improve the supply chain performance and optimize the overall profits of the supply chain under certain conditions compared to the supply chain without dual-purpose subject.Meanwhile,when competitors choose the agency selling format while the dual-purpose retail platform chooses either the reselling or agency selling format,the two retail platforms reach equilibrium in their decision making,depending on the situation.
万方数据
维普
