Coordination For Dynamic Cooperative Advertising In Supply Chain

The concept of supply chain is popular in various industries since1990s. Since that, the interaction among supply chain members becomes more and more frequent and their cooperation covers many areas. As a special way for the supply chain cooperation, cooperative advertising indicates a mechanism that the manufacturer in the upstream supply chain shares a part of down retailer’s advertising costs in order to stimulate the retailer’s sales incentives. Both manufacturer and retailer can benefit from such a program.Deriving from the cooperative advertising practices in the real market, we try to explore the valuable cooperative advertising issues. Utilizing differential game theory, we analyze the optimal decisions of different roles in supply chain in a cooperative advertising program. Firstly, Chapter3focuses on the constraint of the manufacture’s advertising subsidy to the retailer in a traditional cooperative advertising issue. Utilized a three-stage game, the equilibrium co-op decisions of two channel members are derived and the role of the accrual rate in the cooperative advertising decisions is illustrated. Secondly, Chapter4investigates the firms’ cooperative advertising decisions while concerning consumer psychology. The chapter analyzes the impact of reference price effect on the optimal decisions of the manufacturer and retailer. After the research on the cooperative advertising issues in the vertical supply chain consisting of the manufacturer and the retailer, Chapter5and6extend the research framework from the vertical and horizontal perspective, respectively. Specially, Chapter5studies the cooperative advertising issues between the ingredient supplier and the final product manufacturer in a vertical supply chain.In the background of ingredient branding strategy, the supplier shares a part of the manufacturer’s advertising costs and the manufacturer incorporates the supplier’s brand elements into the brand advertising. The chapter investigates the condition that the supplier shares the advertising costs of the manufacturer. In addition, by extending the single supplier to the two complementary suppliers, the impact of different types of co-brands between two suppliers on channel members’cooperative advertising decisions is studied. Chapter6investigates the cooperative advertising programs between two firms in a horizontal supply chain. Two advertising cooperation modes are examined and the optimal advertising decisions of firms in two modes are compared Innovations and contributions of this thesis are briefly summarized as follows:(1) Contents of the thesis are derived from the cooperative advertising practices; the research background of cooperative advertising is enriched. Various practical issues are modeled and the analytical solutions are obtained. Therefore, the thesis contributes to the theoretical research of cooperative advertising.(2) The thesis firstly constructs mathematical models for investigating the impact of the constraint of the manufacturer’s advertising subsidy on the optimal decisions and profit levels of each supply chain member.(3) The thesis firstly considers the consumer psychology factors into the cooperative advertising issues and studies the interaction between consumer’s reference price and supply chain members’ advertising decisions.(4) Traditional research framework for cooperative advertising issues is extended. The thesis studies the cooperative advertising issues which occurred in the different supply chain roles, including between the ingredient suppliers and final production manufacturer, as well as two firms in the horizontal supply chain.