learning from customer interaction: how merchants create price-level propositions for experience...
TRANSCRIPT
Why go with prices online?
The experience-product context
Driving forces that shape price levels • Integrated price strategies v • Branding and CRM e < 0.5 • Shopping convenience di
Modelling • m retailers • Multi-stage and multichannel model • Consumers and retailers deciding No learn
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v + h
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Ai = 2 · (a-v) - h - d1 Pi = 2 · v - t1 - t2 + h
Ai = 2 · (a-d1-v) - (1-e) · min {s,h} + e·s Pi = (v-t1) + ((1-e) · (v+h-t2) · min{h-s,0}) / (h-s)
Ai = 2 · (a-v) + e·s - h - (1-e) · min {s,d2} - d1 Pi = [(1-e) · (v-t1) · min{d2-s,0}] / (d2-s) + (v+h-t2)
Ai = 2 · (a-d1-v+e·s) - (1-e)·[min {s,d2}+min {s,h}] Pi = [(1-e) · (v-t1) · min{d2-s,0}] / (d2-s) + [(1-e) · (v+h-t2) · min{h-s,0}] / (h-s)
Ai = 2 · (a-v) - d1 Pi = 2 · v - t1 - t2
Ai = 2 · (a-d1-v) - (1-e) · min {s,0} + e·s Pi = (v-t1) + ((1-e) · (v-t2) · min{-s,0}) / (-s)
Ai = 2 · (a-v) + h - d1 Pi = 2 · v - t1 - t2 - h
Ai = 2 · (a-d1-v) - (1-e) · min {s,-h} + e·s Pi = (v-t1) + ((1-e) · (v-h-t2) · min{-h-s,0}) / (-h-s)
Ai = 2 · (a-v) + e·s - (1-e) · min {s,d2} - d1 Pi = [(1-e) · (v-t1) · min{d2-s,0}] / (d2-s) + (v-t2)
Ai = 2 · (a-d1-v+e·s) - (1-e)·[min {s,d2}+min {s,0}] Pi = [(1-e) · (v-t1) · min{d2-s,0}] / (d2-s) + [(1-e) · (v-t2) · min{-s,0}]/(-s)
Ai = 2 · (a-v) + e·s + h - (1-e) · min {s,d2} - d1 Pi = [(1-e) · (v-t1) · min{d2-s,0}] / (d2-s) + (v-h-t2)
Ai = 2 · (a-d1-v+e·s) - (1-e)·[min {s,d2}+min {s,-h}] Pi = [(1-e) · (v-t1) · min{d2-s,0}] / (d2-s) + [(1-e)·(v+h-t2)·min{-h-s,0}]/(-h-s)
(1.1.1)
(1.1.2)
(1.2.1)
(1.2.2)
(1.3.1)
(1.3.2)
(2.1.1)
(2.1.2)
(2.2.1)
(2.2.2)
(2.3.1)
(2.3.2)
Results Backward induction
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v
v - h
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v
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Ai = 2 · (a-v) - h - d1 Pi = 2 · v - t1 - t2 + h
Ai = 2 · (a-d1-v) - (1-e) · min {s,h} + e·s Pi = (v-t1) + ((1-e) · (v+h-t2) · min{h-s,0}) / (h-s)
Ai = 2 · (a-v) + e·s - h - (1-e) · min {s,d2} - d1 Pi = [(1-e) · (v-t1) · min{d2-s,0}] / (d2-s) + (v+h-t2)
Ai = 2 · (a-d1-v+e·s) - (1-e)·[min {s,d2}+min {s,h}] Pi = [(1-e) · (v-t1) · min{d2-s,0}] / (d2-s) + [(1-e) · (v+h-t2) · min{h-s,0}] / (h-s)
Ai = 2 · (a-v) - d1 Pi = 2 · v - t1 - t2
Ai = 2 · (a-d1-v) - (1-e) · min {s,0} + e·s Pi = (v-t1) + ((1-e) · (v-t2) · min{-s,0}) / (-s)
Ai = 2 · (a-v) + h - d1 Pi = 2 · v - t1 - t2 - h
Ai = 2 · (a-d1-v) - (1-e) · min {s,-h} + e·s Pi = (v-t1) + ((1-e) · (v-h-t2) · min{-h-s,0}) / (-h-s)
Ai = 2 · (a-v) + e·s - (1-e) · min {s,d2} - d1 Pi = [(1-e) · (v-t1) · min{d2-s,0}] / (d2-s) + (v-t2)
Ai = 2 · (a-d1-v+e·s) - (1-e)·[min {s,d2}+min {s,0}] Pi = [(1-e) · (v-t1) · min{d2-s,0}] / (d2-s) + [(1-e) · (v-t2) · min{-s,0}]/(-s)
Ai = 2 · (a-v) + e·s + h - (1-e) · min {s,d2} - d1 Pi = [(1-e) · (v-t1) · min{d2-s,0}] / (d2-s) + (v-h-t2)
Ai = 2 · (a-d1-v+e·s) - (1-e)·[min {s,d2}+min {s,-h}] Pi = [(1-e) · (v-t1) · min{d2-s,0}] / (d2-s) + [(1-e)·(v+h-t2)·min{-h-s,0}]/(-h-s)
(1.1.1)
(1.1.2)
(1.2.1)
(1.2.2)
(1.3.1)
(1.3.2)
(2.1.1)
(2.1.2)
(2.2.1)
(2.2.2)
(2.3.1)
(2.3.2)
Implications • Adopt higher prices by means of an
integrated pricing strategy • Invest in the branding strategy in the
physical channels • Online, use the values linked to the
brand and knowledge of the clientele and exploit the advantage of the convenience
