Strategic Interactions in Omnichannel Retailing: Analyzing Brand Competition and Optimal Strategy Selection
The rapid advancement of digital technology has blurred the line between online and brick-and-mortar stores, leading to the proliferation of omnichannel retailing. Two widely adopted strategies are Buy Online and Pick Up in Store (BOPS) and Ship from Store (SFS). This study examines a supply chain w...
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MDPI AG
2024-09-01
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| Series: | Journal of Theoretical and Applied Electronic Commerce Research |
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| Online Access: | https://www.mdpi.com/0718-1876/19/4/123 |
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| author | Jing Yu Yufei Ren Chi Zhou |
| author_facet | Jing Yu Yufei Ren Chi Zhou |
| author_sort | Jing Yu |
| collection | DOAJ |
| description | The rapid advancement of digital technology has blurred the line between online and brick-and-mortar stores, leading to the proliferation of omnichannel retailing. Two widely adopted strategies are Buy Online and Pick Up in Store (BOPS) and Ship from Store (SFS). This study examines a supply chain where a manufacturer sells national brand products through an e-commerce platform (e-platform) that also offers its own brand products. We analyze the optimal omnichannel strategies for both the e-platform and the manufacturer, considering scenarios of cooperation and brand competition, across four strategy combinations. Our findings highlight that the profits of both the e-platform and manufacturer are primarily influenced by the commission rate, product category valuation and competition intensity. The commission rate plays a pivotal role in shaping the e-platform’s strategy: a low rate leads to direct competition with the manufacturer, while a high rate prioritizes the manufacturer’s products. When the spillover profit is less than the net difference between the customer’s additional benefits and the firm’s additional costs for SFS compared to BOPS, and the commission rate is high, an equilibrium is achieved. Sensitivity analyses reveal that as the product differentiation decrease, the manufacturer’s profits decline, while the e-platform’s profits rise with an increasing commission rate. |
| format | Article |
| id | doaj-art-97650cf7f7be4a06bfa62d3eb60012aa |
| institution | DOAJ |
| issn | 0718-1876 |
| language | English |
| publishDate | 2024-09-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Journal of Theoretical and Applied Electronic Commerce Research |
| spelling | doaj-art-97650cf7f7be4a06bfa62d3eb60012aa2025-08-20T02:53:19ZengMDPI AGJournal of Theoretical and Applied Electronic Commerce Research0718-18762024-09-011942557258110.3390/jtaer19040123Strategic Interactions in Omnichannel Retailing: Analyzing Brand Competition and Optimal Strategy SelectionJing Yu0Yufei Ren1Chi Zhou2School of Management, Tianjin University of Technology, Tianjin 300384, ChinaLabovitz School of Business and Economics, University of Minnesota Duluth, Duluth, MN 55812, USASchool of Management, Tianjin University of Technology, Tianjin 300384, ChinaThe rapid advancement of digital technology has blurred the line between online and brick-and-mortar stores, leading to the proliferation of omnichannel retailing. Two widely adopted strategies are Buy Online and Pick Up in Store (BOPS) and Ship from Store (SFS). This study examines a supply chain where a manufacturer sells national brand products through an e-commerce platform (e-platform) that also offers its own brand products. We analyze the optimal omnichannel strategies for both the e-platform and the manufacturer, considering scenarios of cooperation and brand competition, across four strategy combinations. Our findings highlight that the profits of both the e-platform and manufacturer are primarily influenced by the commission rate, product category valuation and competition intensity. The commission rate plays a pivotal role in shaping the e-platform’s strategy: a low rate leads to direct competition with the manufacturer, while a high rate prioritizes the manufacturer’s products. When the spillover profit is less than the net difference between the customer’s additional benefits and the firm’s additional costs for SFS compared to BOPS, and the commission rate is high, an equilibrium is achieved. Sensitivity analyses reveal that as the product differentiation decrease, the manufacturer’s profits decline, while the e-platform’s profits rise with an increasing commission rate.https://www.mdpi.com/0718-1876/19/4/123e-businessgame theoryomnichannel retailingprivate-label brandstrategy selection |
| spellingShingle | Jing Yu Yufei Ren Chi Zhou Strategic Interactions in Omnichannel Retailing: Analyzing Brand Competition and Optimal Strategy Selection Journal of Theoretical and Applied Electronic Commerce Research e-business game theory omnichannel retailing private-label brand strategy selection |
| title | Strategic Interactions in Omnichannel Retailing: Analyzing Brand Competition and Optimal Strategy Selection |
| title_full | Strategic Interactions in Omnichannel Retailing: Analyzing Brand Competition and Optimal Strategy Selection |
| title_fullStr | Strategic Interactions in Omnichannel Retailing: Analyzing Brand Competition and Optimal Strategy Selection |
| title_full_unstemmed | Strategic Interactions in Omnichannel Retailing: Analyzing Brand Competition and Optimal Strategy Selection |
| title_short | Strategic Interactions in Omnichannel Retailing: Analyzing Brand Competition and Optimal Strategy Selection |
| title_sort | strategic interactions in omnichannel retailing analyzing brand competition and optimal strategy selection |
| topic | e-business game theory omnichannel retailing private-label brand strategy selection |
| url | https://www.mdpi.com/0718-1876/19/4/123 |
| work_keys_str_mv | AT jingyu strategicinteractionsinomnichannelretailinganalyzingbrandcompetitionandoptimalstrategyselection AT yufeiren strategicinteractionsinomnichannelretailinganalyzingbrandcompetitionandoptimalstrategyselection AT chizhou strategicinteractionsinomnichannelretailinganalyzingbrandcompetitionandoptimalstrategyselection |