Theme：Unifying or Discriminating: Competitive Pricing Strategies for Omnichannel Retailers

Lecturer：Yue Dai,School of Management, Fudan University

Time：2022.05.19 10:00

Site：Tecent meeting 829-773-006

  Abstract：

  A key decision faced by omnichannel retailers is whether to charge the same price online and offline or charge different prices. In a competitive environment with two omnichannel retailers, retailers’ pricing decisions are complicated by consumers’ heterogeneity and their cross-channel/cross-retailer searching behaviors. To examine the pricing decision, we construct a duopoly model with two competing omnichannel retailers where consumers have heterogeneous preferences for retailers. We also consider two consumer segments with heterogeneous product familiarity and assume the store assistance helps uninformed consumers find their match. We uncover the conditions for symmetric pricing equilibria that retailers tend to adopt the dual pricing strategy when the store assistance cost is high and adopt uniform pricing when the market heterogeneity is strong. With the interaction of these two driving forces, an asymmetric pricing equilibrium occurs when the market heterogeneity is intermediate and the store assistance cost is relatively low. In this asymmetric equilibrium, the uniform pricing retailer can obtain higher profits with a uniform price lower than the online and offline prices of its dual pricing rival.

   Introduction to the lecturer：