Markdown Optimization via Approximate Dynamic Programming
We consider the markdown optimization problem faced by the leading apparel retail chain. Because of substitution among products the markdown policy of one product affects the sales of other products. Therefore, markdown policies for product groups having a significant crossprice elasticity among eac...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
Springer
2013-02-01
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| Series: | International Journal of Computational Intelligence Systems |
| Subjects: | |
| Online Access: | https://www.atlantis-press.com/article/25868369.pdf |
| _version_ | 1828527388490727424 |
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| author | Özlem Coşgun Ufuk Kula Cengiz Kahraman |
| author_facet | Özlem Coşgun Ufuk Kula Cengiz Kahraman |
| author_sort | Özlem Coşgun |
| collection | DOAJ |
| description | We consider the markdown optimization problem faced by the leading apparel retail chain. Because of substitution among products the markdown policy of one product affects the sales of other products. Therefore, markdown policies for product groups having a significant crossprice elasticity among each other should be jointly determined. Since the state space of the problem is very huge, we use Approximate Dynamic Programming. Finally, we provide insights on the behavior of how each product price affects the markdown policy. |
| first_indexed | 2024-12-11T21:37:54Z |
| format | Article |
| id | doaj.art-bdec3449725547498c377235679fb69b |
| institution | Directory Open Access Journal |
| issn | 1875-6883 |
| language | English |
| last_indexed | 2024-12-11T21:37:54Z |
| publishDate | 2013-02-01 |
| publisher | Springer |
| record_format | Article |
| series | International Journal of Computational Intelligence Systems |
| spelling | doaj.art-bdec3449725547498c377235679fb69b2022-12-22T00:49:57ZengSpringerInternational Journal of Computational Intelligence Systems1875-68832013-02-016110.1080/18756891.2013.754181Markdown Optimization via Approximate Dynamic ProgrammingÖzlem CoşgunUfuk KulaCengiz KahramanWe consider the markdown optimization problem faced by the leading apparel retail chain. Because of substitution among products the markdown policy of one product affects the sales of other products. Therefore, markdown policies for product groups having a significant crossprice elasticity among each other should be jointly determined. Since the state space of the problem is very huge, we use Approximate Dynamic Programming. Finally, we provide insights on the behavior of how each product price affects the markdown policy.https://www.atlantis-press.com/article/25868369.pdfApproximate Dynamic ProgrammingMultinomial logit modelCross-price elasticityMarkdown optimizationPricing |
| spellingShingle | Özlem Coşgun Ufuk Kula Cengiz Kahraman Markdown Optimization via Approximate Dynamic Programming International Journal of Computational Intelligence Systems Approximate Dynamic Programming Multinomial logit model Cross-price elasticity Markdown optimization Pricing |
| title | Markdown Optimization via Approximate Dynamic Programming |
| title_full | Markdown Optimization via Approximate Dynamic Programming |
| title_fullStr | Markdown Optimization via Approximate Dynamic Programming |
| title_full_unstemmed | Markdown Optimization via Approximate Dynamic Programming |
| title_short | Markdown Optimization via Approximate Dynamic Programming |
| title_sort | markdown optimization via approximate dynamic programming |
| topic | Approximate Dynamic Programming Multinomial logit model Cross-price elasticity Markdown optimization Pricing |
| url | https://www.atlantis-press.com/article/25868369.pdf |
| work_keys_str_mv | AT ozlemcosgun markdownoptimizationviaapproximatedynamicprogramming AT ufukkula markdownoptimizationviaapproximatedynamicprogramming AT cengizkahraman markdownoptimizationviaapproximatedynamicprogramming |