An Analysis of Manufacturer‐Retailer Supply Chain Coordination in Cooperative Advertising*

Huang, Zhimin; Li, Susan X.; Mahajan, Vijay

doi:10.1111/j.1540-5915.2002.tb01652.x

Cited by 209 publications

(147 citation statements)

References 26 publications

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“…Kali [9] studied cooperative advertising from the perspective of coordinating a manufacturer-retailer channel. Huang et al [10] allowed for advertising by the manufacturer in addition to cooperative advertising. They also justified their static model by making a case for short-term effects of promotion.…”

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confidence: 99%

Optimal Advertising and Pricing in a Dynamic Durable Goods Supply Chain

Chutani

Sethi

2012

J Optim Theory Appl

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Cooperative advertising is an incentive offered by a manufacturer to influence retailers' promotional decisions. We study a dynamic durable goods duopoly with a manufacturer and two independent and competing retailers. The manufacturer, as a Stackelberg leader, announces his wholesale prices and his shares of retailers' advertising costs, and the retailers in response play a Nash differential game in choosing their optimal retail prices and advertising efforts over time. We obtain the feedback equilibrium policies for the manufacturer and the retailers in explicit form for a linear demand formulation. We investigate issues, like channel coordination and antidiscriminatory legislation, and also study a case, when the manufacturer sells through only one retailer and the second retailer sells a competing brand.

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confidence: 99%

Optimal Advertising and Pricing in a Dynamic Durable Goods Supply Chain

Chutani

Sethi

2012

J Optim Theory Appl

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“…The market potential dynamics is given by the Sethi model (26). The retailer solves the following problem: The authors also solve the model for a vertically integrated channel.…”

Section: He Prasad and Sethi (2007): Cooperative Advertisingmentioning

confidence: 99%

A survey of Stackelberg differential game models in supply and marketing channels

Prasad

Sethi

et al. 2007

J. Syst. Sci. Syst. Eng.

156

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Stackelberg differential game models have been used to study sequential decision making in noncooperative games in diverse fields. In this paper, we survey recent applications of Stackelberg differential game models to the supply chain management and marketing channels literatures. A common feature of these applications is the specification of the game structure: a decentralized channel composed of a manufacturer and independent retailers, and a sequential decision procedure with demand and supply dynamics and coordination issues. In supply chain management, Stackelberg differential games have been used to investigate inventory issues, wholesale and retail pricing strategies, and outsourcing in dynamic environments. The underlying demand typically has growth dynamics or seasonal variation. In marketing, Stackelberg differential games have been used to model cooperative advertising programs, store brand and national brand advertising strategies, shelf space allocation, and pricing and advertising decisions. The demand dynamics are usually extensions of the classical advertising capital models or sales-advertising response models. We begin by explaining the Stackelberg differential game solution methodology and then provide a description of the models and results reported in the literature.

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“…Promotion effort or advertising is one of the key tools which has extensively been used within service industry to intensify the image of brand name and stimulate instant sales (Giri & Sharma, 2014). According to Huang et al (2002), there are two kinds of advertising: (1) national advertising and, (2) local advertising. National promotion efforts, which are usually exerted by upstream members (e.g.…”

Section: Introductionmentioning

confidence: 99%

Coordination of cooperative promotion efforts with competing retailers in a manufacturer-retailer supply chain

Johari¹,

Hosseini‐Motlagh²

2018

10.5267/j.uscm

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In this paper, the issue of cooperative (co-op) promotion efforts is addressed in a two-stage supply chain (SC). The investigated SC includes one monopolistic manufacturer and two duopolistic retailers facing different market demands. The customers' demand is affected by both advertising efforts of the manufacturer and two retailers. Moreover, the retailers compete with each other on local advertising investments within the market. In order to boost the retailers' advertising level, it is assumed that the manufacturer pays a ratio of the retailers' advertising expenditures. We propose four non-cooperative game scenarios and one cooperative game. Non-cooperative models are established through both Stackelberg and Nash game between two echelons. Moreover, both Cournot and Collusion behaviors are assumed to be followed by two retailers. We develop a promotion cost sharing contract to achieve the channel coordination. Under cooperation model, all SC members seek to reach the highest profit for the entire SC by considering the bargaining power of the SC participants. In each game scenario the optimal solution and unique equilibrium are determined. In addition, a comparison on the advertising level of all SC members along with the value of participation rate are provided. In addition, the feasibility of the cooperative game is discussed and resulted.

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An Analysis of Manufacturer‐Retailer Supply Chain Coordination in Cooperative Advertising*

Cited by 209 publications

References 26 publications

Optimal Advertising and Pricing in a Dynamic Durable Goods Supply Chain

Optimal Advertising and Pricing in a Dynamic Durable Goods Supply Chain

A survey of Stackelberg differential game models in supply and marketing channels

Coordination of cooperative promotion efforts with competing retailers in a manufacturer-retailer supply chain

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