Research Note—The Benefits of Personalized Pricing in a Channel

Marketing Science - Tập 25 Số 1 - Trang 97-105 - 2006
Yunchuan Liu1, Z. John Zhang2
1A. Gary Anderson Graduate School of Management, 900 University Avenue, University of California, Riverside, California 92521#TAB#
2The Wharton School, University of Pennsylvania, 700 Jon M. Huntsman Hall, 3730 Walnut Street, Philadelphia, Pennsylvania 19104-6340#TAB#

Tóm tắt

In this note, we explore channel interactions in an information-intensive environment where the retailer can implement personalized pricing and the manufacturer can leverage both personalized pricing and entry into a direct distribution channel. We study whether a retailer can benefit from personalized pricing and how upstream personalized pricing or entry into a direct distribution channel affects the allocation of channel profit. We find that the retailer is worse off because of its own or upstream personalized pricing, even when the retailer is a monopoly. However, it may still be optimal for the retailer to embrace personalized pricing in order to reap the strategic benefit of deterring the manufacturer from selling direct and targeting end consumers.

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