The Research On Modeling Of Dual-channel Pricing For Small And Medium-sized Manufacturers

The Small and Medium-sized Manufacturers(SEMs) are the important part of our economy, however, with the impact of the international financial crisis on the real economy, the SEMs are facing an unprecedented dilemma. A lot of business practices show that e-commerce can help SEMs to create more business opportunities, but the risk of channel conflict also increases meanwhile. Hence, for the SEMs who are developing dual-channel marketing, how to manage channel conflict and coordinate the relationship between traditional channel and direct online channel have became the most important issues.Considering the influence of the level of purchase involvement on market demand, this paper built a dual-channel pricing decision model at first, in which the manufacturer and retailer made their pricing strategies based on negotiations, then this paper investigated the influence of different power structure and the market environment changes on dual-channel pricing strategies. Afterwards, this paper simulated enterprises’dynamic decision-making process by using multi-agent simulation technology and StarLogo and studied the changes on channel members’decision-making behavior. At last, this paper analyzed the simulation results and expounded the management significance in order to provide some advices for SEMs who are carrying out dual-channel marketing and help them to improve the effectiveness and stability of dual-channel operations.This paper showed that, in the scenario that manufacturer had more power than retailer and manufacturer and retailer had the same power, the price on direct channel and the level of purchase involvement were negatively correlated, and the price on traditional channel and the level of purchase involvement were positively correlated. When the manufacturer was at a non-dominant position, the price on traditional channel and the level of purchase involvement were still positively correlated, but the price on direct channel was influenced by the level of purchase involvement and price discount at the same time, moreover, both the channel members can obtain the optimal profits in this scenario.