Research On Cooperative Advertising Of Enterprises In Supply Chain Based On Evolutionary Game Theory

With the aggravation of the market competition as well as the people’s deeplyunderstanding of the management, supply chain management has become the focus oftheory and application. Good supply chain partnership is a prerequisite for theeffective functioning of the supply chain. As an important coordination mechanism,supply chain cooperative advertising is adopted by more and more enterprises.Research on the existing supply chain cooperative advertising usually focus onthe optimal strategy of the manufacturer and retailer and the analysis of related factors,but the success or failure mechanism of cooperative advertising is the lack of relatedresearch. From views of people bounded rational, This paper established a gamemodel of cooperative advertising based on two-level supply chain composed ofmanufacturers and retailers by using the evolutionary game theory, researched successor failure mechanism of cooperative advertising, and analyzed main influence factorsof the model. Then the paper constructed the extended model includes supervisionand punishment mechanism, and discussed the dynamic evolutionary process ofcooperative advertising. Finally, two examples are presented to validate the models.The study showed that, in the situation of absence of supervision and punishmentmechanism and the retailer can be successfully performed unilateral advertising, themanufacturer and retailer will be cooperate advertisement as long as incomes are bothgreater than the non-cooperative gains; when the retailer failed unilateral advertising,if cooperation benefits are larger than non-cooperation benefits, cooperativeadvertising will have two kinds of evolutionary stable state. At this time, the relatedparameters influence the evolution path of cooperative advertising. Specifically, themore marginal revenue that the manufacturer and retailer earn and the less thatadvertising costs especially the smaller advertising sharing rate that manufactureraccounts for, the greater the possibility of cooperation between the two sides increases.When introduced the supervision and punishment mechanism, the retailer’s defaultbehavior is inhibited, the cooperative advertising is more likely to be successful. Inaddition, we found that the initial strategy of manufacturers and retailers will alsoaffect the success or failure of the cooperative advertising.The research of this paper not only improve the theory of cooperative advertisingin supply chain, but also provide some guidance to the enterprise practice.