Research On Retailer Inventory And Pricing Based On Strategic Customer Behavior

When a customer purchases a product,he often waits for the price to be reduced and then makes a purchase instead of buying it immediately.Today,strategic customer behavior is becoming more common and has a significant impact on retailer profits.This paper examines the impact of strategic customer behavior on retailer profitability in the context of market demand exogenous and market demand endogenous.According to previous research,when market demand is stochastic,price commitment and quantity commitment can alleviate the negative impact of strategic customer behavior.Now,not only is the market demand stochastic,but also the demand and price related scenarios.Firstly,this paper constructs a newsboy model with strategic customers in the situation of demand exogenous.Under this circumstance,this paper discusses the gift promotion strategies and price protection strategies and their feasibility to deal with strategic customer behaviors.Secondly,this paper constructs a market model of demand endogenous,and discusses the feasibility of price commitment and gift promotion strategy for strategic customer behavior.Finally,this paper expands the model.When faced with stochastic demand,and considering the cost of out-of-stocks and declining commodity valuations,the change in retailer profits is studied;when faced with endogenous demand,and considering the market has both strategic customers and myopic customers,the impact of the proportion of strategic customers on retailer profits is studied.According to the research,first of all,in the case of exogenous demand,the gift promotion strategy can effectively alleviate the negative impact of strategic customer behavior and increase the retailer's profit.The price protection strategy is not necessarily effective.Second,in the case of endogenous demand,the existence of strategic customer behavior still reduces retailer's profits.The price commitment strategy is not effective and cannot alleviate the negative impact of strategic customer behavior.The gift promotion strategy can still effectively increase the retailer's profit in this situation.Finally,the study finds that in the case of demand exogenous,when there is a shortage cost,although the quantity commitment strategy will reduce the retailer's inventory,the quantity commitment strategy can still increase retailer's profits,but as the cost of out-of-stock increases,the benefits of quantity commitments are gradually decreasing.In the case of endogenous demand,if there are both strategic customers and myopic customers in the market,according to research,the higher the proportion of strategic customers,the higher the profits that retailers receive.