Advance Selling Strategies Of Competing Retailers In The Presence Of Strategic Consumers Return

The rapid spread of the Internet and information promote the development of advance selling.With the widely application of advance selling,the quality of products is uneven and the functions are excessively rendered,which caused the phenomenon of consumer's return is common.In a more competitive retail market environment,consumers' purchasing and return behaviors become the access to the high position for retailers.Hotelling model is introduced to advance selling under proper assumption.More reasonable marketing strategies are supplied for retailers through the objection of maximizing the retailer's profit.On the basis of consumer utility analysis,profits of retailers with different strategies are compared.Study indicates that the retailer with low unit costs is motivated to take a pre-sale strategy to secure a larger share of the market and more revenue.The retailer's pre-sale behavior greatly cut the profits of other retailers,so that the others will adopt the targeted strategy to reduce losses.Under balanced conditions,both sides take advance selling strategies.In order to better meet the needs of consumers and to win in the competition,consumer's return behavior is discussed.Under pre-sale condition,retailers supply return of goods,so as to maximize eliminate consumers' doubts about product quality,function and other information,and to attract more potential consumers to buy.Research shows that retailers can occupy larger consumer market by offering a full refund.And under certain conditions,the optimal price at this time is higher than that of pure strategy of advance selling.Although return service may not make both sides get more profits,once one of the retailers take return strategy,the other will sustain great loss because of being in a competitive environment.As a result,retailers will take advance selling strategy and offer return service simultaneously.