Study On Selection And Optimization Of Channel Structure In The Electronic Commerce

According to China Electronic Commerce Center’s latest data, as of December2010, the Chinese e-commerce market grew by22%to reach a value of4.5trillion. The online retail market generated about3%of the total of retail sales throughout the year, having a value of513.1billion, an increase of97.3%which is nearly double since2009. With the rapid development of electronic commerce in recent years, various types of enterprises have "net" to carry on e-commerce sales, purchases or services, online direct marketing has become an important platform for the development and way of life. However, when the traditional retail channel is still the case, the introduction of online direct sales channel allows that manufacturers is not only the suppliers but also the competitor of traditional retailers, which is bound to lead to intense channel conflict, so making that the dual channel issue has become the focus of attention.In view of this situation, perspective from the manufacturer, we studied dual-channel supply chain based on the request of channel harmony and profit maximization, integrated use of non-cooperative game theory, theory of consumer choice theory and methods of other disciplines. The paper focused on the relationship between the manufacturing’s strategic pricing and marketing channel choice after introduction the online direct marketing channel. At the same time, the paper also studied how the retailer to provide value added services to cope with the introduction of competition in online direct sale channel, analyzed the results of different of complete information and incomplete information condition. Meanwhile, we studied the decision-marking mechanism under both manufacturers and retailers to promote efforts condition, to reveal an important influence of the non-price factors in the dual-channel supply chain.The main contents of this paper are divided into the following areas:First, in the assumption of traditional retail selling price higher than the direct online price, we built dual channel model which has the manufacturer as the core, considering the impact of channel distribution channel costs and consumer preference on demand channels. Based on the single traditional retail channel pricing, to ease channel conflict, we focused on the manufacturer’s three pricing strategies-whole prices are kept as before, retail prices are kept as before and manufacturer chooses wholesale and online direct price to maximize profit, and the relationship between pricing strategies and channel selections to reveal the impact of the direct channel distribution costs and customer preference for direct sales channels on channel preferences of manufacturers, retailers and supply chain.Secondly, we discussed the new situation that retailers added value products to respond to the competition from the direct channel, which is divided into two cases:complete information and incomplete information. At the same time, the paper also compared the impact of product added value’s cost-effective and customers’price elasticity on price, sales volume and profit, then revealed the impact of service competition in the supply chain on pricing decisions.Finally, we analyzed promotion efforts competition in the dual channel supply chain, considering the two types of marketing efforts:brand marketing and channel level sales promotion. Brand marketing, provided by the manufacturer, does not change the size of the brand loyalty market, but can increase the number of customer who purchase manufacturer’s branded product in the store. channel level sales promotion are provided by the manufacturer’s direct channel and retailers shop, which don’t only increase the market size of brand loyalty but also compete for brand loyalty to their respective channels. The results showed:(1) In the decentralized control of supply chain, the manufacturer invest inadequate brand promotion, and direct channel sale efforts were put so much that it increased the competition between direct sales channel and retail channel; and retail promotional efforts will depend on how much the number of wholesale prices, when the wholesale price is low, retail channel tend to put more marketing efforts, and vice versa.(2) Increasing the potential market size, retailer promotional effort cost efficiency coefficient, the customer flexibility of direct channel marketing efforts, lower cost manufacturers’ promotional efforts.efficiency coefficient and promotional efforts flexible of the retail customers can increase distributed system efficiency.