We are motivated by how offline and online firms compete. The Internet made many conventional offline firms build a dynamic online business as another sales channel using their advantages such as brand equity, an existing customer base with comprehensive purchasing data, integrated marketing, economies of scale, and longtime experience with the logistics of order fulfillment and customer service. Even though the hybrid selling using both offline and online channel seems to have advantages over a pure online retailer, all the conventional offline firms are not seen to create an online business. Many conventional offline firms began to launch online business since the Internet era, however, just being online business is not likely to guarantee success. According to Bizate.com's report whether the hybrid channel strategy is successful is still under investigation. For example, consider the classic case of Barnes and Noble versus Amazon.com, Barnes and Noble was already the largest chain of bookstores in the U,S., when Amazon.com was established in 1995, BarnesandNoble.com followed suit in 1997, After suffering losses in its initial years, Amazon finally turned profitable in 2003. In 2004, Amazon's net income was $588 million on revenues of $6.92 billion, while Barnes and Noble earned $143 million on revenues of $4.87 billion, which included BarnesandNoble.com's loss of $21 million on revenues of $420 million. While these examples serve to motivate our thinking, it does not explain when offline firms should venture online. It also does not provide an analytical framework that can generalized to other competitive online-offline situations. We attempt to do this in this paper and analyze a hybrid channel model where a conventional offline firm competes against online firms using its own direct online channels. We are particularly interested in an optimal channel strategy when a conventional offline firm sells its products through its own direct online channel to compete with other rival online firms. We consider two situations where its direct online channel and other online firms are symmetric and asymmetric in the brand effect. The analysis of this paper presents several findings. In the symmetric model where a hybrid firm's online channel is not differentiated from a pure online firm, (i) a conventional offline firm will not launch its online business. In the asymmetric model where a hybrid firm's online channel is differentiated from a pure online firm, (ii) a conventional offline firm can launch its online business if its brand effect is greater than a certain threshold. (iii) there is a positive relationship between its brand effect and online customer costs showing that a conventional offline firm needs more brand effect in order to launch online business as online customer costs decrease. (iv) there is a negative relationship between its brand effect and the number of customers with access to the Internet showing that a conventional offline firm tends to launch its online business when customers with access to the Internet increases.
International Journal of Advanced Culture Technology
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v.10
no.3
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pp.146-155
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2022
The purpose of this study is to investigate the recyclability of Shenlong in China using SWOT. The main analysis results are as follows. First, provided that the company's current capacity utilization rate is seriously insufficient, reducing staff is one among the effective ways. Second, Shenlong should open a web store to cater to young people's online shopping behavior, and further expand the brand visibility using national mainstream media and online shopping platforms like Taobao and JingDong to market Dongfeng Peugeot and Dongfeng Citroen on the whole network. Third, under the premise of maintaining the present best-selling models, Shenlong should appropriately reduce the amount of models, adjust the assembly capacity ratio of every model and every displacement in real time per the newest market trends, increase the agility of auto companies' production, and timely meet the wants of domestic consumers. Fourth, dual-brand coordination and channel integration are very necessary, and also the profitability and profitability of dealers are going to be further improved, thereby increasing sales. Fifth, target building new energy leading products of Shenlong, strive to attain the forefront of the industry within the sales of recent energy vehicles within 5 years, and gradually expand new energy vehicle products from passenger vehicles to passenger vehicles and commercial vehicles. Finally, the marketing field of Shenlong Automobile should achieve "three major changes", that is, change from a goal-driven type to a demand-driven type, cancel the bundling of outlet invoicing goals and delivery incentive tiers; start from basic capabilities, and set pragmatic and challenging goals; focus Channels, to realize following the activation of outlets, and single store sales increase.
With the rapid development of live streaming commerce, online host as an information source plays a critical role in affecting live streaming performance. However, the impact of different product types on the relationship between online hosts and live streaming has been less studied. Based on the elaboration likelihood model (ELM) and information source theory, this study aims to empirically investigate what factors influence the sales of live streaming commerce and how product type moderates the relationship between them. The analysis of 11,422 live streaming commerce data collected for four months from October 10, 2021 to February 10, 2022 shows that, among the factors related to source credibility and attractiveness, multi-channel networks (MCN) and the number of followers positively affect the sales volume of live streaming commerce, whereas the reputation score harms the sales. Moreover, the moderating effect of the product type (i.e., ratio of involvement products) on the relationships is confirmed. The findings enrich the literature on live streaming commerce performance. The limitations and future research directions are also discussed.
When a channel is vertically separated, there can be inefficiencies, double marginalization. Channel coordination to amend this inefficiency has been an important issue in marketing and economics. Channel coordination deals with maximization of joint profit and achieving proper profit sharing among participants. In this paper, a manufacturer and heterogeneous multiple retailers with exclusive territory are assumed, and channel coordination with two-part tariff is considered. When multiple heterogeneous retailers are assumed, profit sharing can be an issue even though the tariffs based on marginal cost can maximize joint profit. In case of multiple heterogeneous retailers, the manufacturer earns the same profit (fixed fee) from each retailer. This means that a large retailer occupies all the gaps of channel profit between small and large markets. Then, the manufacturer, which generally plays the role of Stackelberg leader, will consider increasing fixed price or marginal price to earn more profit from large retailer. Those reactions can sacrifice maximization of joint profit by making small retailer withdraw or by changing the sales quantities. In this paper, to maximize joint profit and achieve proper profit sharing, two kinds of optional tariffs are considered. The first is an optional two-part tariff based on marginal cost and the second is an optional modified two-part tariff in which marginal prices are higher than the manufacturer's marginal cost. In both types of optional tariffs, maximization of joint profit in each market can be achieved. Moreover, optional tariffs alleviate the problem of profit sharing. Optional tariffs can provide a manufacturer more profit from a large retailer when profit from a small retailer is given. However, the analysis shows that the maximum share of manufacturer from a large retailer is restricted by the condition for self-selection. In case of optional two-part tariffs based on marginal cost, if the gap between demands is large, the maximum share of the manufacturer is sufficient to achieve proper profit sharing. If the gap between demands is not sufficiently large, the manufacturer cannot earn sufficient share from increased profit. An optional modified two-part tariff where marginal price is more than marginal cost of manufacturer is considered because of this scenario. The marginal price above the marginal cost may additionally control the distribution of the increased profit. However, the analysis shows that a manufacturer's maximum profit from a large retailer with given profit from a small retailer is the same as or lower than the maximum profit when optional two-part tariffs based on marginal cost are applied. Therefore, it can be concluded that the optional modified tariffs do not have additional contribution to profit sharing relative to the tariffs based on marginal cost. Although this paper does not cover all kinds of optional tariffs that are different from tariffs based on marginal cost, it shows the advantage of optional tariffs based on marginal cost and has important theoretical implications. The result of this paper also gives guide for channel coordination. Optional two-part tariff based on marginal cost can increase efficiency in channel coordination.
The social curation service that selectively provides information generated by individuals or groups with the same interests can have a synergistic effect when combined with the recently used SNS-based chatting function. If these kinds of chatting-based curation technologies are applied to the Internet shopping malls, particularly, buyers can obtain more reliable information in real time basis, and sellers can provide them with more differentiated and rich information in a continuous manner. This research suggests a chatting-based commerce platform that provides the social curation service based on chats among sellers, existing buyers, and potential buyers. The proposed commerce platform can organize a chat channel for each store and product not only to immediately respond to new and existing customer inquiries about stores, brands, and detailed products, but also to continuously activate differentiated sales strategies to customers subscribed to the channel. In particular, MongoDB is used to permanently save and archive the information and chatting history of each channel, so that the buyer can search and refer to them recorded in the corresponding channel at any time.
To overcome the profitability challenge these days, many global banks are increasingly focusing on cost efficiency through more efficient banking processes, such as online and mobile banking, whereas a number of other banks choose to differentiate their services for retaining and attracting the most valuable customer segment (Deloitte, 2011). While global banks in the retail banking industry are adopting either of these two business models as a strategic choice for their long-term growth, KB Kookmin Bank, one of the leading retail banks in South Korea, has begun to operate 'KB Rockstar' as a strategic channel, particularly designed to target college students in the youth market. The new marketing strategy has resulted in a positive impact on its brand image in customers' perception as well as a drastic increase in the number of youth customers. In this study, we analyze the case of 'KB Rockstar' and summarize the key factors for its success from a marketing perspective. First, 'KB Rockstar' is not simply a good channel strategy, but an innovative marketing strategy that aligns place, product and promotion together in order to create a synergy effect, resulting in the successful implementation of the bank's targeting strategy. Second, the strategy effectively establishes 'KB Rockstar' as a brand targeted to youth customers while also competently strengthening the image of the corporate brand, KB Kookmin Bank. The skillful implementation of organically combined marketing mix strategies has enabled the successful launch of the bank's sub-brand. Third, the strategy considers a retail bank branch as not only the place that makes sales transactions in order to generate short-term profits, but also the place that builds a long-term relationship with customers in order to maximize their lifetime values in the long run.
Internet commerce has been growing at a rapid pace for the last decade. Many firms try to reach wider consumer markets by adding the Internet channel to the existing traditional channels. Despite the various benefits of the Internet channel, a significant number of firms failed in managing the new type of channel. Previous studies could not cleary explain these conflicting results associated with the Internet channel. One of the major reasons is most of the previous studies conducted analyses under a specific market condition and claimed that as the impact of Internet channel introduction. Therefore, their results are strongly influenced by the specific market settings. However, firms face various market conditions in the real worlddensity and disutility of using the Internet. The purpose of this study is to investigate the impact of various market environments on a firm's optimal channel strategy by employing a flexible game theory model. We capture various market conditions with consumer density and disutility of using the Internet.
shows the channel structures analyzed in this study. Before the Internet channel is introduced, a monopoly manufacturer sells its products through an independent physical store. From this structure, the manufacturer could introduce its own Internet channel (MI). The independent physical store could also introduce its own Internet channel and coordinate it with the existing physical store (RI). An independent Internet retailer such as Amazon could enter this market (II). In this case, two types of independent retailers compete with each other. In this model, consumers are uniformly distributed on the two dimensional space. Consumer heterogeneity is captured by a consumer's geographical location (ci) and his disutility of using the Internet channel (${\delta}_{N_i}$).
shows various market conditions captured by the two consumer heterogeneities.
(a) illustrates a market with symmetric consumer distributions. The model captures explicitly the asymmetric distributions of consumer disutility in a market as well. In a market like that is represented in
(c), the average consumer disutility of using an Internet store is relatively smaller than that of using a physical store. For example, this case represents the market in which 1) the product is suitable for Internet transactions (e.g., books) or 2) the level of E-Commerce readiness is high such as in Denmark or Finland. On the other hand, the average consumer disutility when using an Internet store is relatively greater than that of using a physical store in a market like (b). Countries like Ukraine and Bulgaria, or the market for "experience goods" such as shoes, could be examples of this market condition.
summarizes the various scenarios of consumer distributions analyzed in this study. The range for disutility of using the Internet (${\delta}_{N_i}$) is held constant, while the range of consumer distribution (${\chi}_i$) varies from -25 to 25, from -50 to 50, from -100 to 100, from -150 to 150, and from -200 to 200.
summarizes the analysis results. As the average travel cost in a market decreases while the average disutility of Internet use remains the same, average retail price, total quantity sold, physical store profit, monopoly manufacturer profit, and thus, total channel profit increase. On the other hand, the quantity sold through the Internet and the profit of the Internet store decrease with a decreasing average travel cost relative to the average disutility of Internet use. We find that a channel that has an advantage over the other kind of channel serves a larger portion of the market. In a market with a high average travel cost, in which the Internet store has a relative advantage over the physical store, for example, the Internet store becomes a mass-retailer serving a larger portion of the market. This result implies that the Internet becomes a more significant distribution channel in those markets characterized by greater geographical dispersion of buyers, or as consumers become more proficient in Internet usage. The results indicate that the degree of price discrimination also varies depending on the distribution of consumer disutility in a market. The manufacturer in a market in which the average travel cost is higher than the average disutility of using the Internet has a stronger incentive for price discrimination than the manufacturer in a market where the average travel cost is relatively lower. We also find that the manufacturer has a stronger incentive to maintain a high price level when the average travel cost in a market is relatively low. Additionally, the retail competition effect due to Internet channel introduction strengthens as average travel cost in a market decreases. This result indicates that a manufacturer's channel power relative to that of the independent physical retailer becomes stronger with a decreasing average travel cost. This implication is counter-intuitive, because it is widely believed that the negative impact of Internet channel introduction on a competing physical retailer is more significant in a market like Russia, where consumers are more geographically dispersed, than in a market like Hong Kong, that has a condensed geographic distribution of consumers. illustrates how this happens. When mangers consider the overall impact of the Internet channel, however, they should consider not only channel power, but also sales volume. When both are considered, the introduction of the Internet channel is revealed as more harmful to a physical retailer in Russia than one in Hong Kong, because the sales volume decrease for a physical store due to Internet channel competition is much greater in Russia than in Hong Kong. The results show that manufacturer is always better off with any type of Internet store introduction. The independent physical store benefits from opening its own Internet store when the average travel cost is higher relative to the disutility of using the Internet. Under an opposite market condition, however, the independent physical retailer could be worse off when it opens its own Internet outlet and coordinates both outlets (RI). This is because the low average travel cost significantly reduces the channel power of the independent physical retailer, further aggravating the already weak channel power caused by myopic inter-channel price coordination. The results implies that channel members and policy makers should explicitly consider the factors determining the relative distributions of both kinds of consumer disutility, when they make a channel decision involving an Internet channel. These factors include the suitability of a product for Internet shopping, the level of E-Commerce readiness of a market, and the degree of geographic dispersion of consumers in a market. Despite the academic contributions and managerial implications, this study is limited in the following ways. First, a series of numerical analyses were conducted to derive equilibrium solutions due to the complex forms of demand functions. In the process, we set up V=100, ${\lambda}$=1, and ${\beta}$=0.01. Future research may change this parameter value set to check the generalizability of this study. Second, the five different scenarios for market conditions were analyzed. Future research could try different sets of parameter ranges. Finally, the model setting allows only one monopoly manufacturer in the market. Accommodating competing multiple manufacturers (brands) would generate more realistic results.
In this study we develop core technology of Multi-Charmel Voice Guidance System based on active 2.45GHz RFID that can be used in the field of advertising. Through this, we can service more familiar with voice information to foreigners by own language in large scale international event. As an alternative to the current high-expensive voice guidance system in exhibition hall and provide more value added services to user. As the result, we present the configuration of integrated software platform which include media server, media client and receiver. It can be as a basis infra equipment for a signtseeing in RFID/USN environment. Additionally through tag information analysis about exposure of advertisement that is collected late, supposed system may achieve role as a new marketing tool.
The study set up research models and hypotheses to examine the influence of HMR selection attributes on satisfaction and repurchase intention by distribution channels(convenience store/large market), verify the research hypothesis through empirical analysis, respectively. The purpose of this study is to investigate the convenience sampling method of HMR purchase from convenience store and large market in Seoul and Gyeonggi area. The survey was conducted from January 8, 2018 to January 26, 2018, and 300 questionnaires were distributed and 289 of them were used as an effective data. For the empirical analysis, SPSS 20.0 was used. The results of the analysis are as follows. First, product quality only has a significant effect on satisfaction among HMR selection attributes at convenience store, and product safety and convenience have no significant effect on satisfaction. Second, only the convenience of HMR selection attributes in the large market has a significant effect on satisfaction, and product safety and product quality have no significant effect on satisfaction. Third, HMR satisfaction in convenience stores and large markets has a significant effect on repurchase intention. The purpose of this study is to investigate the relationships among HMR selection attributes, satisfaction, and repurchase intention, which are important in the existing HMR research, by each distribution channel(convenience store/large market). It is meaningful to help them establish an effective sales strategy for each segment.
This study aims to provide distributors with several implications on the channel strategy by testing factors which influence on the offsetting investment. Medium-sized distributor facing a relatively inferior power can cause profit vulnerability from large manufacurer's opportunistic behaviors. At the same time, we tested the relationship commitment to the relation with manufacturer as another alternative strategy taken by medium-sized distributer. For this research, samples from dealers in oil-petroleum refinery industry were selected and the data was collected using mail survey. The data was analyzed utilizing validity test, reliability test, factor analysis, correlation analysis and LISREL. The major analyzed results are as follows: First, the offsetting investment of preventing loss from manufacturer's opportunism didn't affect medium-sized distributor's sales empirically. Second, the hypothesis that the more the medium-sized distributor's transaction specific assets which they invest in the transactional relationship with manufacturer, the more the safeguard against the expected opportunism of manufacturer was not supported by the results. Third, the more use of coercive power by the manufacturer, the more increase in the perception of expected opportunism of manufacturer by the medium-sized distributor, it make stimulates offsetting investment as safeguard by medium-sized distributor and it has negative effect on developing commitment. Finally, the large manufactures dealing with a medium-sized distributor firm which had a reputation of fairness didn't make offsetting investment as a response for distributor's opportunism.
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