Optimal strategy for selling on group-buying website
Purpose: The purpose of this paper is to help business marketers with offline channels to make decisions on whether to sell through Group-buying (GB) websites and how to set online price with the coordination of maximum deal size on GB websites. Design/methodology/approach: Considering the deal stru...
| Autores: | , |
|---|---|
| Tipo de recurso: | artículo |
| Fecha de publicación: | 2014 |
| País: | España |
| Institución: | Universitat Politècnica de Catalunya (UPC) |
| Repositorio: | UPCommons. Portal del coneixement obert de la UPC |
| Idioma: | inglés |
| OAI Identifier: | oai:upcommons.upc.edu:2099/15509 |
| Acceso en línea: | https://hdl.handle.net/2099/15509 |
| Access Level: | acceso abierto |
| Palabra clave: | Electronic commerce Group-buying Pricing Deal size Advertisement Dual channel Comerç electrònic Àrees temàtiques de la UPC::Economia i organització d'empreses::Comerç electrònic |
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Optimal strategy for selling on group-buying websiteJiang, XuanDeng, ShimingElectronic commerceGroup-buyingPricingDeal sizeAdvertisementDual channelComerç electrònicÀrees temàtiques de la UPC::Economia i organització d'empreses::Comerç electrònicPurpose: The purpose of this paper is to help business marketers with offline channels to make decisions on whether to sell through Group-buying (GB) websites and how to set online price with the coordination of maximum deal size on GB websites. Design/methodology/approach: Considering the deal structure of GB websites especially for the service fee and minimum deal size limit required by GB websites, advertising effect of selling on GB websites, and interaction between online and offline markets, an analytical model is built to derive optimal online price and maximum deal size for sellers selling through GB website. This paper aims to answer four research questions: (1) How to make a decision on maximum deal size with coordination of the deal price? (2) Will selling on GB websites always be better than staying with offline channel only? (3) What kind of products is more appropriate to sell on GB website? (4)How could GB website operator induce sellers to offer deep discount in GB deals? Findings and Originality/value: This paper obtains optimal strategies for sellers selling on GB website and finds that: Even if a seller has sufficient capacity, he/she may still set a maximum deal size on the GB deal to take advantage of Advertisement with Limited Availability (ALA) effect; Selling through GB website may not bring a higher profit than selling only through offline channel when a GB site only has a small consumer base and/or if there is a big overlap between the online and offline markets; Low margin products are more suitable for being sold online with ALA strategies (LP-ALA or HP-ALA) than high margin ones; A GB site operator could set a small minimum deal size to induce deep discounts from the sellers selling through GB deals. Research limitations/implications: The present study assumed that the demand function is determinate and linear. It will be interesting to study how stochastic demand and a more general demand function affect the optimal strategies. Practical implications: This paper provides a very useful model framework and optimal strategies for sellers’ selling on GB website. It takes advantage of the analytical model to explain much typical practical phenomenon for E-commerce like free sale with limited availability and so forth. It also helps GB website operator to induce deep discount from sellers. Originality/value: This paper is a first attempt to examine the seller's GB sale decision problem regarding to price and bounds on deal sizes. It analyses how the minimum deal size set by the GB website affect the optimal decision of sellers’. Moreover, it also discusses the impact of the interactions between online and offline markets on sellers’ decisionPeer ReviewedOmniaScience20142014-10-0120142014-10-28journal articlehttp://purl.org/coar/resource_type/c_6501NAhttp://purl.org/coar/version/c_be7fb7dd8ff6fe43info:eu-repo/semantics/articleapplication/pdfhttps://hdl.handle.net/2099/15509reponame:UPCommons. Portal del coneixement obert de la UPCinstname:Universitat Politècnica de Catalunya (UPC)Inglésengopen accesshttp://purl.org/coar/access_right/c_abf2Attribution-NonCommercial 3.0 Spainhttp://creativecommons.org/licenses/by-nc/3.0/es/info:eu-repo/semantics/openAccessoai:upcommons.upc.edu:2099/155092026-05-27T15:37:01Z |
| dc.title.none.fl_str_mv |
Optimal strategy for selling on group-buying website |
| title |
Optimal strategy for selling on group-buying website |
| spellingShingle |
Optimal strategy for selling on group-buying website Jiang, Xuan Electronic commerce Group-buying Pricing Deal size Advertisement Dual channel Comerç electrònic Àrees temàtiques de la UPC::Economia i organització d'empreses::Comerç electrònic |
| title_short |
Optimal strategy for selling on group-buying website |
| title_full |
Optimal strategy for selling on group-buying website |
| title_fullStr |
Optimal strategy for selling on group-buying website |
| title_full_unstemmed |
Optimal strategy for selling on group-buying website |
| title_sort |
Optimal strategy for selling on group-buying website |
| dc.creator.none.fl_str_mv |
Jiang, Xuan Deng, Shiming |
| author |
Jiang, Xuan |
| author_facet |
Jiang, Xuan Deng, Shiming |
| author_role |
author |
| author2 |
Deng, Shiming |
| author2_role |
author |
| dc.subject.none.fl_str_mv |
Electronic commerce Group-buying Pricing Deal size Advertisement Dual channel Comerç electrònic Àrees temàtiques de la UPC::Economia i organització d'empreses::Comerç electrònic |
| topic |
Electronic commerce Group-buying Pricing Deal size Advertisement Dual channel Comerç electrònic Àrees temàtiques de la UPC::Economia i organització d'empreses::Comerç electrònic |
| description |
Purpose: The purpose of this paper is to help business marketers with offline channels to make decisions on whether to sell through Group-buying (GB) websites and how to set online price with the coordination of maximum deal size on GB websites. Design/methodology/approach: Considering the deal structure of GB websites especially for the service fee and minimum deal size limit required by GB websites, advertising effect of selling on GB websites, and interaction between online and offline markets, an analytical model is built to derive optimal online price and maximum deal size for sellers selling through GB website. This paper aims to answer four research questions: (1) How to make a decision on maximum deal size with coordination of the deal price? (2) Will selling on GB websites always be better than staying with offline channel only? (3) What kind of products is more appropriate to sell on GB website? (4)How could GB website operator induce sellers to offer deep discount in GB deals? Findings and Originality/value: This paper obtains optimal strategies for sellers selling on GB website and finds that: Even if a seller has sufficient capacity, he/she may still set a maximum deal size on the GB deal to take advantage of Advertisement with Limited Availability (ALA) effect; Selling through GB website may not bring a higher profit than selling only through offline channel when a GB site only has a small consumer base and/or if there is a big overlap between the online and offline markets; Low margin products are more suitable for being sold online with ALA strategies (LP-ALA or HP-ALA) than high margin ones; A GB site operator could set a small minimum deal size to induce deep discounts from the sellers selling through GB deals. Research limitations/implications: The present study assumed that the demand function is determinate and linear. It will be interesting to study how stochastic demand and a more general demand function affect the optimal strategies. Practical implications: This paper provides a very useful model framework and optimal strategies for sellers’ selling on GB website. It takes advantage of the analytical model to explain much typical practical phenomenon for E-commerce like free sale with limited availability and so forth. It also helps GB website operator to induce deep discount from sellers. Originality/value: This paper is a first attempt to examine the seller's GB sale decision problem regarding to price and bounds on deal sizes. It analyses how the minimum deal size set by the GB website affect the optimal decision of sellers’. Moreover, it also discusses the impact of the interactions between online and offline markets on sellers’ decision |
| publishDate |
2014 |
| dc.date.none.fl_str_mv |
2014 2014-10-01 2014 2014-10-28 |
| dc.type.none.fl_str_mv |
journal article http://purl.org/coar/resource_type/c_6501 NA http://purl.org/coar/version/c_be7fb7dd8ff6fe43 |
| dc.type.openaire.fl_str_mv |
info:eu-repo/semantics/article |
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article |
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https://hdl.handle.net/2099/15509 |
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https://hdl.handle.net/2099/15509 |
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Inglés eng |
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Inglés |
| language |
eng |
| dc.rights.none.fl_str_mv |
open access http://purl.org/coar/access_right/c_abf2 Attribution-NonCommercial 3.0 Spain http://creativecommons.org/licenses/by-nc/3.0/es/ |
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info:eu-repo/semantics/openAccess |
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open access http://purl.org/coar/access_right/c_abf2 Attribution-NonCommercial 3.0 Spain http://creativecommons.org/licenses/by-nc/3.0/es/ |
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openAccess |
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application/pdf |
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OmniaScience |
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OmniaScience |
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reponame:UPCommons. Portal del coneixement obert de la UPC instname:Universitat Politècnica de Catalunya (UPC) |
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Universitat Politècnica de Catalunya (UPC) |
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UPCommons. Portal del coneixement obert de la UPC |
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