Coordination of traditional and online group-buying channels considering website promotion effort

• DOI: 10.24200/sci.2018.50750.1850
• Publication Date: 2019-05-11T03:49:43Z
• Authors: Yifan Wu; Danning Li; Tian Li
• Keywords: Stackelberg competition; Revenue Sharing; Group buying; Promotion (chess)

The development of modern technology and e-commerce have given rise to the emergence many new selling channels. Among one them, group-buying attracts numerous customers rapidly due characters deep discounts great convenience. Although create sales growth for sellers, it also causes loss in their profit margins. Meanwhile, business model websites is not thoroughly understood literature. Based on a Stackelberg game framework, this paper studies equilibrium between website seller. optimal pricing channel decisions seller promotion effort are investigated offer guidance businesses. We find that total whole system could be hurt when agreement price or revenue sharing contracts adopted by firms. propose revenue-cost contract coordinate profit. Finally, we show how scale unit cost influence equilibrium.