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Now showing items 1 - 16 of 25

  • Equilibrium decisions for an innovation crowdsourcing platform

    Cheng, Xi   Gou, Qinglong   Yue, Jinfeng   Zhang, Yan  

    In this study, we formulated a game between three stakeholders in an innovative crowdsourcing platform, comprising the platform itself, sponsors, and participants. Using the Stackelberg game and auction theory, we derived the participant's equilibrium effort strategy in a single-prize contest, a two-prize contest, or a multiple-prize contest; we also derived the sponsor's optimal decision for its award mechanism. We proved that the single-prize contest is always preferred by the sponsor. Additionally, we derived the platform's optimal decision under the fixed and proportional intermediary fee schedules and found that the fixed schedule will maximize the platform's profit.
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  • Pricing decisions for a supply chain with refurbished products

    Zhang, Yan   He, Yanyan   Yue, Jinfeng   Gou, Qinglong  

    This paper considers a supply chain consisting of a supplier and a retailer where a fixed portion of new products sold will be returned to the retailer and then be repaired and resold as refurbished products at a lower price. Using the utility model, we formulate how consumers will make their choices when facing both new and refurbished products. Then, using the divide-and-conquer method, we derive the supplier and retailer's equilibrium decisions, including the supplier's wholesale price and the retailer's prices for both the new and refurbished products. The main findings include the following. First, refurbished products will be sold in the market only when the refurbishing cost is small. In this situation, as the refurbishing cost increases, most of the negative impact on the retailer will be transferred to the supplier. Second, in the same condition, as the refurbishing cost increases, the wholesale price and retail price of the new product will change in opposite directions. This result contrasts with the traditional pass-through effect. Third, when the repair cost is moderate, the retailer will eventually not sell refurbished products, but its profit can be significantly improved and the double marginalisation effect can be mitigated.
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  • Advertising Strategies for Mobile Platforms With "Apps"

    Wang, Ruibing   Gou, Qinglong   Choi, Tsan-Ming   Liang, Liang  

    Mobile platforms are prevalently used in the age of social media. They serve a two-sided market to connect users and app developers. In this system, members simultaneously sell products, publish advertisements (ads), and advertise. This paper aims to explore advertising strategies for the mobile platform incorporating their roles as sellers, ad publishers, and advertisers. Specifically, we develop a game-theoretical model which captures the relationship among the works of the platform owner and app developers in a dynamic setting. Our analysis shows that when the platform displays apps' ads, the owner may be better off to participate in apps' advertising under certain conditions, rather than always charging them aggressively as suggested by convention wisdom. Surprisingly, although the negative impacts evoked by multiple apps' entry deserve much attention, it is unnecessary for app developers to take into account when making advertising decisions. We further find that the coordinating bilateral participation in advertising is a new mechanism to improve the profitability. Unlike the result proposed in the previous literature, the mechanism here will cause free-riding among app developers when they participate in the platform's advertising. Furthermore, when accompanied with the revenue sharing policy, the relatively low participation rates could absolutely eliminate the system inefficiency.
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  • Selective crowdsourcing with various type task: models and analysis

    Gou, Qinglong   Deng, Fangdi   He, Yanyan  

    Purpose Selective crowdsourcing is an important type of crowdsourcing which has been popularly used in practice. However, because selective crowdsourcing uses a winner-takes-all mechanism, implying that the efforts of most participants except the final winner will be just in vain. The purpose of this paper is to explore why this costly mechanism can become a popularity during the past decade and which type of tasks can fit this mechanism well. Design/methodology/approach The authors propose a game model between a sponsor and N participants. The sponsor is to determine its reward and the participants are to optimize their effort-spending strategy. In this model, each participant's ability is the private information, and thus, all roles in the system face incomplete information. Findings The results of this paper demonstrate the following: whether the sponsor can obtain a positive expected payoff are determined by the type of tasks, while the complex tasks with a strong learning effect is more suitable to selective crowdsourcing, as for the other two types of task, the sponsor cannot obtain a positive payoff, or can just gain a rather low payoff; besides the task type, the sponsor's efficiency in using the solutions and the public's marginal cost also influence the result that whether the sponsor can obtain a positive surplus from the winner-takes-all mechanism. Originality/value The model presented in this paper is innovative by containing the following characteristics. First, each participant's ability is private information, and thus, all roles in the system face incomplete information. Second, the winner-takes-all mechanism is used, implying that the sponsor's reward will be entirely given to the participant with the highest quality solution. Third, the sponsor's utility from the solutions, as well as the public's cost to complete the task, are both assumed as functions just satisfying general properties.
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  • Equilibrium decisions for an innovation crowdsourcing platform

    Cheng, Xi   Gou, Qinglong   Yue, Jinfeng   Zhang, Yan  

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  • Supply Chain Contracting with Linear Utility Function

    Wang, Ningning   Gu, Jibao   Gou, Qinglong   Yue, Jinfeng  

    The supply chain contracting has traditionally been based on the profit maximization assumption. Recent research has shown that some behavior factors may influence the decision making of supply chain members. The authors utilize a linear utility function to depict such behavior factors and incorporate these into the newsvendor model. The linear utility function provides sufficient flexibility to better capture people's various behavior factors. By supposing the agents are concerned with behavior factors, the authors first investigate how the factors affect the supply chain under wholesale price contract, and find that they do not influence coordination condition, but can adjust the distribution of profits. Then they extend their study to other four common contracts with a similar method and systematically demonstrate that the behavior of agents in such a linear setting has no effect on the conditions of coordinating supply chain.
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  • Cooperative Advertising with Accrual Rate in a Dynamic Supply Chain

    Zhang, Juan   Gou, Qinglong   Li, Susan   Huang, Zhimin  

    We consider a supply chain in which a manufacturer stimulates his retailers investing more local advertising expenditures through a cooperative advertising program (Co-op). Co-op advertising programs usually involve two important contractual terms, a participation rate and an accrual rate. While previous literatures have discussed the participation rate excessively, they seldom study the role of the accrual rate in cooperative advertising. To investigate the impact of the accrual rate on cooperative advertising decisions, we develop a dynamic cooperative advertising model for a single manufacturer-single retailer supply chain that incorporates the participation rate and the accrual rate simultaneously. We derive the equilibrium co-op decisions of two channel members, including the manufacturer's national advertising efforts and his participation rate, as well as the retailer's local advertising expenditure. Our analysis of the equilibrium solutions shows that an increase in participation rate will not always increase the retailer's advertising efforts because of the accrual rate. Also, both the manufacturer and retailer can benefit from a high accrual rate.
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  • Co-op supply chains with a local media company: Models and analysis

    Gou, Qinglong   Shao, Jing   Wang, Xin   Yu, Lili  

    A cooperative (co-op) advertising program is an incentive scheme in which a manufacturer shares its retailers' local advertising costs. Such programs have received increasing academic attention in the past two decades. However, the local media company, as the agent of local advertising, has been ignored by previous literature. Another practical aspect being ignored is that the manufacturer only shares the retailer's local media advertising cost - the retailer's in-store advertising cost is not subsidized. To investigate the role of local media companies in co-op advertising programs, we focus on a system consisting of a manufacturer, a retailer, and a local media company. With a co-op advertising model incorporating these two previously ignored aspects, we derive the equilibrium decisions of the three members. Our results show that the local media company should implement a differential pricing strategy based on co-op, i.e., to offer retailers a discount if manufacturers provide them co-op, and all three members can benefit from such a strategy. In addition, different from the classic conclusion, we find that in some condition the manufacturer's participation rate may increase in the retailer's marginal profit. Our work could guide manufacturers, retailers, and local media companies to make their strategies related to co-op advertising programs.
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  • Editor’s Introduction

    Gou, Qinglong   Liang, Liang   Huang, Zhimin   Li, Susan X.  

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  • Joint pricing and advertising strategy with reference price effect

    Lu, Lihao   Gou, Qinglong   Tang, Wansheng   Zhang, Jianxiong  

    Consumers are susceptible to reference price effects when they make purchase decisions for a certain product. Meanwhile, the sales price and advertisement are the determinable factors that have impact on consumers' reference price which are also fundamental marketing strategies. Therefore, how to determine an appropriate sales price and advertising effort level to maximise firms' profits is an essential task. A joint pricing and advertising problem for a monopolistic firm with consideration of reference price effect is investigated, where consumer demand rate is price-sensitivity and depends on the gap between the sales price and the reference price in consumers' mind. An optimisation model is established to maximise the firm's total profit by making a joint pricing and advertising strategy. The static and dynamic joint strategies are obtained by applying Pontryagin's maximum principle. Results show that the dynamic strategies dominate the static ones. Furthermore, the dynamic pricing and dynamic advertising strategies are strategic complements. Additionally, the length of the sales period plays a key role in determining the superiority of the two dynamic strategies. Specifically, a relatively short sales period highlights the value of the dynamic advertising while a long sales period strengthens the function of the dynamic pricing.
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  • Horizontal cooperative programmes and cooperative advertising

    Gou, Qinglong   Zhang, Juan   Liang, Liang   Huang, Zhimin   Ashley, Allan  

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  • Push and Pull Contracts in a Local Supply Chain with an Outside Market

    Gou, Qinglong   Sethi, Suresh   Yue, Jinfeng   Zhang, Juan  

    Wholesale price contracts are widely studied in a single supplier-single retailer supply chain, but without considering an outside market where the supplier may sell if he gets a high enough price and the retailer may buy if the price is low enough. We fill this gap in the literature by studying push and pull contracts in a local supplier-retailer supply chain with the presence of an outside market. Taking the local supplier's maximum production capacity and the outside market barriers into account, we identify the Pareto set of the push and/or pull contracts and draw managerial implications. The main results include the following. First, the most inefficient point of the pull Pareto set cannot always be removed by considering both the push and pull contracts. Second, the supplier's production capacity plays a significant role in the presence of an outside market; it affects the supplier's negotiating power with the retailer and the coordination of the supply chain can be accomplished only with a large enough capacity. Third, the import and export barriers influence the supply chain significantly: (i) an export barrier in the local market and the supplier's production capacity influence the supplier's export strategy; (ii) a low import (resp., export) barrier in the local market can improve the local supply chain's efficiency by use of a push (resp., pull) contract; and (iii) a high import (resp., export) barrier in the local market encourages the supplier (resp., retailer) to bear more inventory risk. [Submitted: February 11, 2015. Revised: September 9, 2015. Accepted: November 5, 2015.]
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  • Push and Pull Contracts in a Local Supply Chain with an Outside Market*

    Gou, Qinglong   Sethi, Suresh   Yue, Jinfeng   Zhang, Juan  

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  • Cooperative Advertising in a Supply Chain with Horizontal Competition

    He, Yi   Gou, Qinglong   Wu, Chunxu   Yue, Xiaohang  

    Cooperative advertising programs are usually provided by manufacturers to stimulate retailers investing more in local advertising to increase the sales of their products or services. While previous literature on cooperative advertising mainly focuses on a "single-manufacturer single-retailer" framework, the decision-making framework with "multiple-manufacturer single-retailer" becomes more realistic because of the increasing power of retailers as well as the increased competition among the manufacturers. In view of this, in this paper we investigate the cooperative advertising program in a "two-manufacturer single-retailer" supply chain in three different scenarios; that is, (i) each channel member makes decisions independently; (ii) the retailer is vertically integrated with one manufacturer; (iii) two manufacturers are horizontally integrated. Utilizing differential game theory, the open-loop equilibrium advertising strategies of each channel member are obtained and compared. Also, we investigate the effects of competitive intensity on the firm's profit in three different scenarios by using the numerical analysis.
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  • Monetization on Mobile Platforms:Balancing in-App Advertising and User Base Growth

    Ji, Yonghua   Wang, Ruibing   Gou, Qinglong  

    Monetizing the growth of mobile platforms is increasingly important as more and more users adopt mobile platforms such as the Google's Android OS and the Apple's iOS. In this study, we use a differential game theoretical model to study the problem of joint advertising investment and in-app advertising adoption decisions by platform owners and app developers on a mobile platform. A key finding is that a platform owner may delay or even not offer an in-app advertising program if the revenue from such a program is low, which could explain the termination of Apple's iAd in-app advertising program. One unexpected result is that when determining advertising effort or the timing of an in-app advertising program, a platform owner does not need to consider the app developer's advertising effectiveness. Another interesting result is that an app developer acts strategically with an increase in ease of app searching: he either follows the platform owner to increase advertising or decreases it to take a free ride, depending on the effectiveness of his advertising effort. Finally, our analysis shows that in order to coordinate the mobile platform system, a central planner should adopt a mixed transfer payment scheme that includes both revenue sharing and advertising cost sharing, regardless of whether competition exists.
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  • Coordination of a fashion and textile supply chain with demand variations

    Wang, Ke   Gou, Qinglong   Sun, Jinwen   Yue, Xiaohang  

    Owing to the changing fashion trends and a volatile market situation, demand in fashion and textile (FT) industry is unpredictable and could vary and change completely in a short time, which makes it more difficult to coordinate a FT supply chain. A change in product preference due to fashion trends is the main reason why the demand of FT industry shows more variations than other industries. In this paper, we use a well known contract, the all-unit quantity discount policy (AQDP), to coordinate a FT supply chain with certain demand, and we further consider it under the demand variations scenario to investigate whether it can still coordinate the supply chain. In detail, before the selling season, an AQDP is provided by the manufacturer to the retailer, and under which the FT supply chain coordination achieved with a certain demand. During the selling season, demand variation is realized after an abrupt changing of fashion trends, therefore, the manufacturer may need to revise the original AQDP to insure the supply chain is still coordinated. Utilizing the mechanism design theory, we prove that: (i) while the traditional AQDP can coordinate the supply chain when no demand variations, it cannot always coordinate the supply chain after the demand variations; (ii) when the AQDP fails, we can use the proposed capacitated linear pricing policy (CLPP) to achieve a new coordination; (iii) a more dominant decision maker, who can set a higher profit goal, is favorable to stabilization of the supply chain system under demand variations. Numerical examples are proposed also to show our results.
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