Optimal decisions for fixed-price group-buying business originated in China: a game theoretic perspective

Ni, Guanqun; Xu, Yinfeng; Xu, Jiuping; Dong, Yucheng

doi:10.1080/00207543.2014.965350

Cited by 16 publications

(16 citation statements)

References 27 publications

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“…This study focused on the selling price of online group purchases and considered various parameters, such as the upper limit of demand L, the unit cost c, the influence coefficient of the price on demand E, etc. This study used the grey correlation ranking method and grey multi-attribute decision-making (TOPSIS) to further determine the optimal shelf-time, inventory quantity, and selling price (key parameters) of commodities in order to design a plan that makes the maximum profit for the industry and provides the best service to customers [6][7][8][9][10][11][12]. In previous studies, Ni et al [9], considered the optimal fixed-price decisions, Deng et al [10] considered the optimal price and maximum deal size, and Lu et al [2] considered effect of behavior on workplace relationships in online group purchasing.…”

Section: Discussionmentioning

confidence: 99%

“…Therefore, this study focuses on the selling price of online group buying products and considers various parameters, such as the upper limit of demand L, the unit cost c, the influence coefficient of price on demand E, etc. This study uses the grey correlation ranking method and grey multi-attribute decision-making (plan selection) to further plan the optimal shelf-time, inventory quantity, and selling price (key parameters) of commodities in order to design a plan that makes maximum profit for the industry and provides the best service to customers [6][7][8][9][10][11][12].…”

Section: Introductionmentioning

confidence: 99%

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Optimal Multiple Attribute Decision Model for Key Parameters of Online Group Buying Product

Wang

Lien

2019

Mathematics

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The rise of the internet has led to rapid development of online group buying, and with the various functions and analysis tools provided on the internet, consumers are making more purchases than ever before. In addition to attracting consumers to buy products or services via online shopping platforms, the industry’s online group buying market allows customers to enjoy preferential prices together. Consumers can bargain through large-scale purchases. Through quantity-based pricing, the effect of the decline on consumers’ expected price will be enhanced, and consumers will be able to purchase products at lower prices, which encourages more consumers to join group buying schemes. In terms of product cost, online shopping operations enable manufacturers to save shop setup and inventory costs, and some of these cost savings may be reflected in the selling price, which can enable customers to obtain products at lower prices. The grey decision model is used for further in-depth exploration. The purpose of this study is to use the grey correlation ranking and grey multi-attribute decision-making (TOPSIS) process to further determine the optimal shelf-time, inventory quantity, and selling price (key parameters) of commodities, in order to design a plan that makes maximum profit for the industry and provides the best service to customers.

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Section: Discussionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Optimal Multiple Attribute Decision Model for Key Parameters of Online Group Buying Product

Wang

Lien

2019

Mathematics

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“…Focusing on the negative network effects, Ni et al [17] divide consumers into two segments according to their communication costs in GB and find that offering a GB option might decrease seller’s profit in several circumstances. Based on a game theoretic formulation, Ni et al [18] argue that GB is more efficient when the communication cost is smaller and there is also an upper bound of communication cost for the seller to offer a GB option.…”

Section: Introductionmentioning

confidence: 99%

A pricing model for group buying based on network effects

2019

PLoS ONE

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Group buying (GB) is a popular business model in e-commerce. With the rise of online social media, the positive network effect of buying with others is more important than price discount for consumers to choose GB. However, the negative network effect of GB is also significant for some consumers. In this paper, we classify consumers into two segments considering both positive and negative network effects, and three possible sales strategies as well as their optimal decisions on price are presented. We find that GB strategy dominates individual buying (IB) strategy when the positive network effect is sufficiently high or the proportion of consumers with low valuation is relatively large. We also find that MIX strategy offering both IB and GB is always better than IB, while the relationship between MIX and GB is depending on actual market situations. Some other managerial insights are also discussed.

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“…The UGS model (seller has his own groupbuying website) is more profitable than the basic model for the seller. But it only includes the online business and there is no offline business [3].Preference uncertainty and consumption state uncertainty of customersare considered and by taking a comprehensive perspective, they find that no show of voucher buyers may not be a good thing for the merchant, especially for those large or start-up ones [12]. The impact of group-buying network positive effects and other negative effects are studied on the performance of group buying business model [13].…”

Section: International Conference On Applied Mathematics Simulation mentioning

confidence: 99%

“…Customers would pay the related price given the total quantity at the end of the selling period [3]. The traditional dynamic group buying mechanism has been extensively studied in the literature.…”

Section: Literature Reviewmentioning

confidence: 99%

The Effect of Customer Perceived Service Quality on the Optimal Group-Buying Strategy

Wu¹,

Zhu²

2016

Proceedings of the 2016 International Conference on Applied Mathematics, Simulation and Modelling

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Abstract-In this paper, we study the popular group-buying model in which theseller offers discount on the group-buying websites to attract new customers coming to experience its service. This paper analyses seller's pricing decision between only running offline business and joining the group-buying business. We find that when only running offline business, higher perceived service quality will bring more profit for the seller. However, if the seller joins the group-buying website and the perceived service quality is relatively low, seller's profit will decrease with it. If the seller's service quality is higher than the perceived service quality, he will improve his regular price after joining the group-buying website. Moreover, only when the group-buying website scale is relatively big can the seller make more profit by joining the group-buying website.

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Optimal decisions for fixed-price group-buying business originated in China: a game theoretic perspective

Cited by 16 publications

References 27 publications

Optimal Multiple Attribute Decision Model for Key Parameters of Online Group Buying Product

Optimal Multiple Attribute Decision Model for Key Parameters of Online Group Buying Product

A pricing model for group buying based on network effects

The Effect of Customer Perceived Service Quality on the Optimal Group-Buying Strategy

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