Camplementary Product Bundling Strategy And Pricing Decision Research In The Competitive Market

The competition between enterprises and enterprises continuously upgrade has put forward the new challenge to the enterprise how to operate, how to survive and how to develop itself in the competition. Enterprises that how to deal with the relationship between itself and competitors have risen to the strategic level, which become the problem the enterprise managers have to think about. At the same time, the concept of complements has been known widely, more and more enterprises produce related products not just a single product. Under this background, the complementary strategy is becoming more and more important, the enterprise can take advantage of the complementary product strategy especially the bundling strategy to enhance their competitive advantage.Based on summarizing the domestic and foreign literature, using consumer utility, game theory and other related theories, combining with calculation and numerical simulation, exploring the bundling strategy and price decision when enterprise facing the competitive market structure. The main content as follows:Firstly, the incumbent should choose which kind of bundling strategy when facing the potential entrant producing a single product. We calculate the equilibrium prices of two enterprises and the incumbent’s profits, compare the profits between the bundling strategy and unbundling strategy. This paper found that the incumbent choose unbundling strategy of profit is greater than the bundling strategy.Secondly, the incumbent should choose which kind of bundling strategy when facing the potential entrant producing complementary product, then the potential entrant should choose which kind of bundling strategy after knowing the incumbent’s action. We calculate the equilibrium prices and profits of two enterprises respectively in the both of two enterprises are unbundling, only one enterprise is bundling, both of two enterprises are bundling. We analyze the different range of bundling strategy through the complete information dynamic game. Further we analyze the influence of the product cost and value on bundling strategy.