Cooperative advertising between O2O catering channels: In perspective of different integration modes

Abstract

More catering companies are trying to increase their capacity utilization during off-peak hours through O2O (online-to-offline) platforms. In order to increase the opportunities for potential customers to spend online, platforms often require catering companies to participate in cooperative advertising, but this may harm the catering companies' profits from offline customers. This research builds different game-theoretic models based on different O2O channel integration modes, and obtains the optimal cooperative advertising decisions and profits. In addition, the influence of model parameters (i.e., product attractiveness, advertising interaction, price discounts and platform listing fees) on optimized advertising decisions and profits is also discussed.