Price-Matching Guarantee with Endogeneized Consumer Search

Jiang, Juncai; Kumar, Nanda; Ratchford, Brian T.

doi:10.2139/ssrn.1630026

Cited by 2 publications

(3 citation statements)

References 34 publications

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“…More recently, given the theoretical importance and empirical evidence of price matching guarantees (PMGs), a group of marketing researchers have paid close attention to the area. Besides [8], there are a growing stream of literature choose price matching. Yankelevich and Vaughan [31] found that announcements to price-match raise prices by altering heterogeneous consumer search behavior by using a model of sequential search.…”

Section: Literature On the Impact Of Dynamic Pricing And Price Matmentioning

confidence: 99%

“…The profit of the two retailers can be obtained from (7) and (8). The two retailers' first-order condition for profits Where the above equality follows by the induction step; the last one follows (5) and (6).…”

Section: B the Proof Of Theoremmentioning

confidence: 99%

“…One tactic, known as "price matching". Jiang et al [8] gave a theoretical explanation of the price matching guarantees (PMGs). Under the price matching strategy, if consumers find lower prices elsewhere within a period of time after purchase, the retailer will match the price and refund the difference.…”

Section: Introductionmentioning

confidence: 99%

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How Does Heterogeneous Consumer Behavior Affect Pricing Strategies of Retailers?

Peng

2020

IEEE Access

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This paper presents the latest progress on pricing and revenue management. Consumer's switching purchase behavior occurs frequently in perishable goods retail market, and we propose a twoperiod dynamic pricing model among online and offline retailers under heterogeneous purchase behavior of myopic consumers and strategic consumers. Through equilibrium solution and analysis, this study discusses the optimal pricing strategy under the influence of the service perception factor and the proportion of two kinds of consumers. Moreover, this paper analyzes the effect of three pricing strategies on profits to prove the effectiveness of price matching strategy implemented by offline retailers. The results show that the strategic behavior of heterogeneous consumers does not always have a negative impact on the profits of two retailers. The offline retailers can strategically choose to set higher prices to increase profits, and online retailers can also reduce the impact of heterogeneous consumer behavior by disclosing product attribute information. It is unwise for online retailers to take the initiative to match the price set by the offline retailers. In contrast, offline retailers can achieve a win-win situation for both retailers by matching the price of the online retailers actively.

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Section: Literature On the Impact Of Dynamic Pricing And Price Matmentioning

confidence: 99%