Cooperative advertising in a dual channel supply chain. (5th October 2006)

• Record Type: Journal Article
• Authors: Yan, Ruiliang; Ghose, Sanjoy; Bhatnagar, Amit
• Is Part Of: International journal of electronic marketing and retailing. Volume 1:Number 2(2006)
• Page Start: 99
• Page End: 114
• Publication Date: 2006-10-05
• Subjects: direct marketing -- retail marketing -- cooperative advertising -- distribution channels -- Bertrand and Stackelberg competition -- supply chain management -- SCM -- electronic marketing -- electronic advertising -- dual channel supply chains -- internet advertising -- online marketing -- e-marketing -- e-advertising -- online advertising -- internet marketing; Telemarketing -- Periodicals; Internet marketing -- Periodicals; Electronic commerce -- Periodicals; 658.872
• Languages: English
• ISSNs: 1741-1025

Abstract

The focus of this study is cooperative (co-op) advertising and the impact it has on the dual channel supply chain. We obtain equilibrium pricing and co-op advertising policies under two different competitive scenarios: Bertrand and Stackelberg equilibrium. We also compare the profit gains under these two marketing games. Based on our results, we propose the optimal strategies that system members should adopt in a dual channel competition. We also illustrate that by strategically implementing a cooperative advertising strategy under different market structures, both the system players can effectively improve their overall profits in a dual channel supply chain management.