Competition Strategy of Online Retailers Considering Service Sensitivity and Cognitive Differences
In order to analyze the competitive behavior of online retailers in complex market under the environment of diversified customers, a duopoly competition model considering the service sensitivity and cognitive differences is established by using the Hotelling model. The equilibrium price, demand and...
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| Format: | Article |
| Language: | zho |
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Journal of Computer Engineering and Applications Beijing Co., Ltd., Science Press
2022-09-01
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| Series: | Jisuanji kexue yu tansuo |
| Subjects: | |
| Online Access: | http://fcst.ceaj.org/fileup/1673-9418/PDF/2103110.pdf |
| _version_ | 1798017584960897024 |
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| author | ZHOU Xiaoxiang, HUANG Chengfeng, LI Hao |
| author_facet | ZHOU Xiaoxiang, HUANG Chengfeng, LI Hao |
| author_sort | ZHOU Xiaoxiang, HUANG Chengfeng, LI Hao |
| collection | DOAJ |
| description | In order to analyze the competitive behavior of online retailers in complex market under the environment of diversified customers, a duopoly competition model considering the service sensitivity and cognitive differences is established by using the Hotelling model. The equilibrium price, demand and revenue of static game and dynamic game are solved, and the changing trend is studied by numerical simulation. Results have shown that online retailers' profits are affected by the service sensitivity and cognitive differences, not only related to the price directly, but also relevant to unit service cost, brand cognition and competitors' pricing strategy highly. The high service providers with internet brand cognition have a significant price advantage, which means high service is always accompanied by high prices. Stray price effects exist in online retailers, blind to improve the quality of the cognitive service may do more harm than good for the low quality of service provider. Online retailers have the first-mover advantages. The previous decision maker's equilibrium profit is obviously higher than the latter, as well as the price. The dynamic equilibrium is also significantly better than the static equilibrium on profits and price. Online retailers have sufficient intrinsic motivation to grab the opportunity. There is a theoretical threshold for the service level of online retail, and merchants will not provide services beyond the threshold. Theoretical references can be provided on the pricing competition and service mode selection for online retailers in the context of big data. |
| first_indexed | 2024-04-11T16:09:39Z |
| format | Article |
| id | doaj.art-704d61d06d93490abfe0fef02ea2bac7 |
| institution | Directory Open Access Journal |
| issn | 1673-9418 |
| language | zho |
| last_indexed | 2024-04-11T16:09:39Z |
| publishDate | 2022-09-01 |
| publisher | Journal of Computer Engineering and Applications Beijing Co., Ltd., Science Press |
| record_format | Article |
| series | Jisuanji kexue yu tansuo |
| spelling | doaj.art-704d61d06d93490abfe0fef02ea2bac72022-12-22T04:14:43ZzhoJournal of Computer Engineering and Applications Beijing Co., Ltd., Science PressJisuanji kexue yu tansuo1673-94182022-09-011692096210710.3778/j.issn.1673-9418.2103110Competition Strategy of Online Retailers Considering Service Sensitivity and Cognitive DifferencesZHOU Xiaoxiang, HUANG Chengfeng, LI Hao01. School of Economics and Management, Chongqing Jiaotong University, Chongqing 400074, China;2. Western China Transportation-Economy-Society Development Study Center, Chongqing Jiaotong University, Chongqing 400074, ChinaIn order to analyze the competitive behavior of online retailers in complex market under the environment of diversified customers, a duopoly competition model considering the service sensitivity and cognitive differences is established by using the Hotelling model. The equilibrium price, demand and revenue of static game and dynamic game are solved, and the changing trend is studied by numerical simulation. Results have shown that online retailers' profits are affected by the service sensitivity and cognitive differences, not only related to the price directly, but also relevant to unit service cost, brand cognition and competitors' pricing strategy highly. The high service providers with internet brand cognition have a significant price advantage, which means high service is always accompanied by high prices. Stray price effects exist in online retailers, blind to improve the quality of the cognitive service may do more harm than good for the low quality of service provider. Online retailers have the first-mover advantages. The previous decision maker's equilibrium profit is obviously higher than the latter, as well as the price. The dynamic equilibrium is also significantly better than the static equilibrium on profits and price. Online retailers have sufficient intrinsic motivation to grab the opportunity. There is a theoretical threshold for the service level of online retail, and merchants will not provide services beyond the threshold. Theoretical references can be provided on the pricing competition and service mode selection for online retailers in the context of big data.http://fcst.ceaj.org/fileup/1673-9418/PDF/2103110.pdf|online retailers|service sensitivity|cognitive differences|competition strategy |
| spellingShingle | ZHOU Xiaoxiang, HUANG Chengfeng, LI Hao Competition Strategy of Online Retailers Considering Service Sensitivity and Cognitive Differences Jisuanji kexue yu tansuo |online retailers|service sensitivity|cognitive differences|competition strategy |
| title | Competition Strategy of Online Retailers Considering Service Sensitivity and Cognitive Differences |
| title_full | Competition Strategy of Online Retailers Considering Service Sensitivity and Cognitive Differences |
| title_fullStr | Competition Strategy of Online Retailers Considering Service Sensitivity and Cognitive Differences |
| title_full_unstemmed | Competition Strategy of Online Retailers Considering Service Sensitivity and Cognitive Differences |
| title_short | Competition Strategy of Online Retailers Considering Service Sensitivity and Cognitive Differences |
| title_sort | competition strategy of online retailers considering service sensitivity and cognitive differences |
| topic | |online retailers|service sensitivity|cognitive differences|competition strategy |
| url | http://fcst.ceaj.org/fileup/1673-9418/PDF/2103110.pdf |
| work_keys_str_mv | AT zhouxiaoxianghuangchengfenglihao competitionstrategyofonlineretailersconsideringservicesensitivityandcognitivedifferences |