Product matching information disclosure and product line design
This paper investigates a monopolist's information disclosure strategy and product line design when consumers are uncertain about product matching information.The impact of the firm's matching disclosure strategy on product line design is analyzed,and when the firm should reveal product matching information is discussed.To investigate these questions,a model of a monopolist firm selling high-end and low-end products to heterogeneous consumers is constructed.It is found that the firm should adjust the quality of product line design in accordance with the matching disclosure strategy.Specifically,compared with not disclosing match-ing information,when only matching information of high-end(low-end)products is disclosed,the quality of low-end products should be improved(degraded)and the quality gap between high-end and low-end products decreases(increases).When the matching information of both products is provided,the distortion of the quality design of low-end products depends on the matching probabilities that different customers perceive the product is suitable.Moreover,a firm's matching disclosure strategy depends on market characteristics.The firm tend to reveal only the matching information of low-end products when the ex-post valuation of low-end consumers is high.This study provides important managerial insights for e-tailers'joint decisions of matching disclosure strategy and product line design.
fit uncertaintyproduct line designmatching disclousure strategy
万方数据
维普
