IDEAS home Printed from https://ideas.repec.org/a/eee/joreco/v18y2011i1p19-26.html
   My bibliography  Save this article

Product distribution and coordination strategies in a multi-channel context

Author

Listed:
  • Yan, Ruiliang
  • Guo, Peijun
  • Wang, John
  • Amrouche, Nawel

Abstract

Channel coordination plays a strategically important role in a multi-channel context. In this study, we focus on the strategic roles played by product distribution and coordinative structure with profit sharing in the multi-channel context. We use an analytical model to show that the brand differentiation is not a dominant distribution strategy to coordinate the channel conflict and improve channel performance; the manufacturer can sell identical brands through its online and traditional channels and actively employ a cooperative structure with profit coordination to maximize the entire distribution of channel profit and create a win–win channel strategy for each channel member. In addition, we also investigate the impact of an online channel on the whole distribution channel performance under the different structures. Our results show that coordinative market structure provides competitive advantages for the manufacturer to open an online channel, particularly for these manufacturers whose products are weakly compatible with the online marketing. Based on our results, we derive optimal market strategies for the multi-channel manufacturer and retailer.

Suggested Citation

  • Yan, Ruiliang & Guo, Peijun & Wang, John & Amrouche, Nawel, 2011. "Product distribution and coordination strategies in a multi-channel context," Journal of Retailing and Consumer Services, Elsevier, vol. 18(1), pages 19-26.
    • Handle: RePEc:eee:joreco:v:18:y:2011:i:1:p:19-26
    DOI: 10.1016/j.jretconser.2010.09.001
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0969698910000846
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jretconser.2010.09.001?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Yan, Ruiliang & Pei, Zhi, 2009. "Retail services and firm profit in a dual-channel market," Journal of Retailing and Consumer Services, Elsevier, vol. 16(4), pages 306-314.
    2. Ramarao Desiraju & Sridhar Moorthy, 1997. "Managing a Distribution Channel Under Asymmetric Information with Performance Requirements," Management Science, INFORMS, vol. 43(12), pages 1628-1644, December.
    3. Cadeaux, Jack M., 1994. "Flexibility and performance of branch store stock plans for a manufacturer's product line," Journal of Business Research, Elsevier, vol. 29(3), pages 207-218, March.
    4. Nanda Kumar & Ranran Ruan, 2006. "On manufacturers complementing the traditional retail channel with a direct online channel," Quantitative Marketing and Economics (QME), Springer, vol. 4(3), pages 289-323, September.
    5. Li, Susan X. & Huang, Zhimin & Zhu, Joe & Chau, Patrick Y. K., 2002. "Cooperative advertising, game theory and manufacturer-retailer supply chains," Omega, Elsevier, vol. 30(5), pages 347-357, October.
    6. Seifert, Ralf W. & Thonemann, Ulrich W. & Sieke, Marcel A., 2006. "Integrating direct and indirect sales channels under decentralized decision-making," International Journal of Production Economics, Elsevier, vol. 103(1), pages 209-229, September.
    7. Mukhopadhyay, Samar K. & Yao, Dong-Qing & Yue, Xiaohang, 2008. "Information sharing of value-adding retailer in a mixed channel hi-tech supply chain," Journal of Business Research, Elsevier, vol. 61(9), pages 950-958, September.
    8. Kyle Cattani & Wendell Gilland & Hans Sebastian Heese & Jayashankar Swaminathan, 2006. "Boiling Frogs: Pricing Strategies for a Manufacturer Adding a Direct Channel that Competes with the Traditional Channel," Production and Operations Management, Production and Operations Management Society, vol. 15(1), pages 40-56, March.
    9. Nash, John, 1950. "The Bargaining Problem," Econometrica, Econometric Society, vol. 18(2), pages 155-162, April.
    10. Timothy W. McGuire & Richard Staelin, 1983. "An Industry Equilibrium Analysis of Downstream Vertical Integration," Marketing Science, INFORMS, vol. 2(2), pages 161-191.
    11. Abel P. Jeuland & Steven M. Shugan, 1983. "Managing Channel Profits," Marketing Science, INFORMS, vol. 2(3), pages 239-272.
    12. Esther Gal-Or, 2004. "Evaluating the Profitability of Product Bundling in the Context of Negotiations," The Journal of Business, University of Chicago Press, vol. 77(4), pages 639-674, October.
    13. Kay-Yut Chen & Murat Kaya & Özalp Özer, 2008. "Dual Sales Channel Management with Service Competition," Manufacturing & Service Operations Management, INFORMS, vol. 10(4), pages 654-675, June.
    14. Rajeev Kohli & Heungsoo Park, 1989. "A Cooperative Game Theory Model of Quantity Discounts," Management Science, INFORMS, vol. 35(6), pages 693-707, June.
    15. Eitan Gerstner & James D. Hess, 1995. "Pull Promotions and Channel Coordination," Marketing Science, INFORMS, vol. 14(1), pages 43-60.
    16. Nirvikar Singh & Xavier Vives, 1984. "Price and Quantity Competition in a Differentiated Duopoly," RAND Journal of Economics, The RAND Corporation, vol. 15(4), pages 546-554, Winter.
    17. Karray, Salma & Zaccour, Georges, 2006. "Could co-op advertising be a manufacturer's counterstrategy to store brands?," Journal of Business Research, Elsevier, vol. 59(9), pages 1008-1015, September.
    18. Yan, Ruiliang & Ghose, Sanjoy, 2010. "Forecast information and traditional retailer performance in a dual-channel competitive market," Journal of Business Research, Elsevier, vol. 63(1), pages 77-83, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Pei, Zhi & Toombs, Leslie & Yan, Ruiliang, 2014. "How does the added new online channel impact the supporting advertising expenditure?," Journal of Retailing and Consumer Services, Elsevier, vol. 21(3), pages 229-238.
    2. Amrouche, Nawel & Yan, Ruiliang, 2013. "Can a weak retailer benefit from manufacturer-dominant retailer alliance?," Journal of Retailing and Consumer Services, Elsevier, vol. 20(1), pages 34-42.
    3. Mohammad Kazem Sayadi & Ahmad Makui, 2014. "Feedback Nash Equilibrium for Dynamic Brand and Channel Advertising in Dual Channel Supply Chain," Journal of Optimization Theory and Applications, Springer, vol. 161(3), pages 1012-1021, June.
    4. T. M. Rofin & Biswajit Mahanty, 2018. "Optimal dual-channel supply chain configuration for product categories with different customer preference of online channel," Electronic Commerce Research, Springer, vol. 18(3), pages 507-536, September.
    5. Li, Bo & Jiang, Yushan, 2019. "Impacts of returns policy under supplier encroachment with risk-averse retailer," Journal of Retailing and Consumer Services, Elsevier, vol. 47(C), pages 104-115.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yan, Ruiliang & Pei, Zhi, 2011. "Information asymmetry, pricing strategy and firm's performance in the retailer- multi-channel manufacturer supply chain," Journal of Business Research, Elsevier, vol. 64(4), pages 377-384, April.
    2. Nawel Amrouche & Ruiliang Yan, 2016. "A manufacturer distribution issue: how to manage an online and a traditional retailer," Annals of Operations Research, Springer, vol. 244(2), pages 257-294, September.
    3. Pei, Zhi & Yan, Ruiliang, 2013. "National advertising, dual-channel coordination and firm performance," Journal of Retailing and Consumer Services, Elsevier, vol. 20(2), pages 218-224.
    4. Matsui, Kenji, 2017. "When should a manufacturer set its direct price and wholesale price in dual-channel supply chains?," European Journal of Operational Research, Elsevier, vol. 258(2), pages 501-511.
    5. Huang, Song & Zhang, Xianmei & Chen, Shuting, 2021. "Information acquisition with advertising threshold effect under manufacturer encroachment in a supply chain," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 153(C).
    6. Pei, Zhi & Toombs, Leslie & Yan, Ruiliang, 2014. "How does the added new online channel impact the supporting advertising expenditure?," Journal of Retailing and Consumer Services, Elsevier, vol. 21(3), pages 229-238.
    7. Amrouche, Nawel & Yan, Ruiliang, 2013. "Can a weak retailer benefit from manufacturer-dominant retailer alliance?," Journal of Retailing and Consumer Services, Elsevier, vol. 20(1), pages 34-42.
    8. Yan, Ruiliang & Pei, Zhi, 2009. "Retail services and firm profit in a dual-channel market," Journal of Retailing and Consumer Services, Elsevier, vol. 16(4), pages 306-314.
    9. Amrouche, Nawel & Yan, Ruiliang, 2015. "Aggressive or partnership strategy: Which choice is better for the national brand?," International Journal of Production Economics, Elsevier, vol. 166(C), pages 50-63.
    10. Amrouche, Nawel & Yan, Ruiliang, 2012. "Implementing online store for national brand competing against private label," Journal of Business Research, Elsevier, vol. 65(3), pages 325-332.
    11. Yan, Ruiliang & Pei, Zhi & Myers, Chris, 2016. "Do channel members value the multiple-cooperation strategy?," Journal of Retailing and Consumer Services, Elsevier, vol. 30(C), pages 84-95.
    12. Yan, Ruiliang & Pei, Zhi & Ghose, Sanjoy, 2019. "Reward points, profit sharing, and valuable coordination mechanism in the O2O era," International Journal of Production Economics, Elsevier, vol. 215(C), pages 34-47.
    13. Xie, Jinxing & Wei, Jerry C., 2009. "Coordinating advertising and pricing in a manufacturer-retailer channel," European Journal of Operational Research, Elsevier, vol. 197(2), pages 785-791, September.
    14. SeyedEsfahani, Mir Mehdi & Biazaran, Maryam & Gharakhani, Mohsen, 2011. "A game theoretic approach to coordinate pricing and vertical co-op advertising in manufacturer-retailer supply chains," European Journal of Operational Research, Elsevier, vol. 211(2), pages 263-273, June.
    15. Messinger, Paul R., 2016. "The role of fairness in competitive supply chain relationships: An experimental studyAuthor-Name: Choi, Sungchul," European Journal of Operational Research, Elsevier, vol. 251(3), pages 798-813.
    16. Li, Tingting & Xie, Jinxing & Zhao, Xiaobo, 2015. "Supplier encroachment in competitive supply chains," International Journal of Production Economics, Elsevier, vol. 165(C), pages 120-131.
    17. Salma Karray & Chirag Surti, 2016. "Channel coordination with quantity discounts and/or cooperative advertising," International Journal of Production Research, Taylor & Francis Journals, vol. 54(17), pages 5317-5335, September.
    18. Yuyan Wang & Zhaoqing Yu & Liang Shen & Yan Ge & Jing Li, 2018. "Different Dominant Models and Fairness Concern of E-Supply Chain," Complexity, Hindawi, vol. 2018, pages 1-13, December.
    19. Chen, Jingxian & Liang, Liang & Yao, Dong-qing, 2019. "Factory encroachment and channel selection in an outsourced supply chain," International Journal of Production Economics, Elsevier, vol. 215(C), pages 73-83.
    20. Ghosh, Debabrata & Shah, Janat, 2015. "Supply chain analysis under green sensitive consumer demand and cost sharing contract," International Journal of Production Economics, Elsevier, vol. 164(C), pages 319-329.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:joreco:v:18:y:2011:i:1:p:19-26. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.journals.elsevier.com/journal-of-retailing-and-consumer-services .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.