Endogenous royalty factor in a licensing contract
The owner of a well known fashion brand grants a manufacturer the rights to produce and sell a second-line brand against a percentage of the sales called royalty. To this end, the brand owner and the manufacturer sign a licensing contract which assigns the owner, who has already determined...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
University of Belgrade
2016-01-01
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| Series: | Yugoslav Journal of Operations Research |
| Subjects: | |
| Online Access: | http://www.doiserbia.nb.rs/img/doi/0354-0243/2016/0354-02431500014B.pdf |
| _version_ | 1818209473051754496 |
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| author | Buratto Alessandra Grosset Luca Viscolani Bruno |
| author_facet | Buratto Alessandra Grosset Luca Viscolani Bruno |
| author_sort | Buratto Alessandra |
| collection | DOAJ |
| description | The owner of a well known fashion brand grants a manufacturer the rights to
produce and sell a second-line brand against a percentage of the sales called
royalty. To this end, the brand owner and the manufacturer sign a licensing
contract which assigns the owner, who has already determined his advertising
campaign, the right of determining the royalty factor. The manufacturer will
plan her advertising campaign for the licenced product in order to maximize
her profit. The brand owner’s objective is twofold: on the one hand, he wants
to maximize the profit coming from the contract, on the other hand, he wants
to improve the value of the brand at the end of a given planning period. We
model this interaction between the two agents using a Stackelberg game, where
the brand owner is the leader and the manufacturer is the follower. We
characterise the royalty percentage and the licensee’s advertising effort
which constitute the unique Stackelberg equilibrium of the game. |
| first_indexed | 2024-12-12T05:01:16Z |
| format | Article |
| id | doaj.art-ca195fd377874a4694701febcf41f6e2 |
| institution | Directory Open Access Journal |
| issn | 0354-0243 |
| language | English |
| last_indexed | 2024-12-12T05:01:16Z |
| publishDate | 2016-01-01 |
| publisher | University of Belgrade |
| record_format | Article |
| series | Yugoslav Journal of Operations Research |
| spelling | doaj.art-ca195fd377874a4694701febcf41f6e22022-12-22T00:37:13ZengUniversity of BelgradeYugoslav Journal of Operations Research0354-02432016-01-0126326327810.2298/YJOR150120014B0354-02431500014BEndogenous royalty factor in a licensing contractBuratto Alessandra0Grosset Luca1Viscolani Bruno2University of Padova, Department of Mathematics, Padova, ItalyUniversity of Padova, Department of Mathematics, Padova, ItalyUniversity of Padova, Department of Mathematics, Padova, ItalyThe owner of a well known fashion brand grants a manufacturer the rights to produce and sell a second-line brand against a percentage of the sales called royalty. To this end, the brand owner and the manufacturer sign a licensing contract which assigns the owner, who has already determined his advertising campaign, the right of determining the royalty factor. The manufacturer will plan her advertising campaign for the licenced product in order to maximize her profit. The brand owner’s objective is twofold: on the one hand, he wants to maximize the profit coming from the contract, on the other hand, he wants to improve the value of the brand at the end of a given planning period. We model this interaction between the two agents using a Stackelberg game, where the brand owner is the leader and the manufacturer is the follower. We characterise the royalty percentage and the licensee’s advertising effort which constitute the unique Stackelberg equilibrium of the game.http://www.doiserbia.nb.rs/img/doi/0354-0243/2016/0354-02431500014B.pdfOR in marketingLicensingAdvertisingStackelberg game |
| spellingShingle | Buratto Alessandra Grosset Luca Viscolani Bruno Endogenous royalty factor in a licensing contract Yugoslav Journal of Operations Research OR in marketing Licensing Advertising Stackelberg game |
| title | Endogenous royalty factor in a licensing contract |
| title_full | Endogenous royalty factor in a licensing contract |
| title_fullStr | Endogenous royalty factor in a licensing contract |
| title_full_unstemmed | Endogenous royalty factor in a licensing contract |
| title_short | Endogenous royalty factor in a licensing contract |
| title_sort | endogenous royalty factor in a licensing contract |
| topic | OR in marketing Licensing Advertising Stackelberg game |
| url | http://www.doiserbia.nb.rs/img/doi/0354-0243/2016/0354-02431500014B.pdf |
| work_keys_str_mv | AT burattoalessandra endogenousroyaltyfactorinalicensingcontract AT grossetluca endogenousroyaltyfactorinalicensingcontract AT viscolanibruno endogenousroyaltyfactorinalicensingcontract |