research-article

Service strategies and channel coordination in the age of E-commerce

Authors:

Nawel Amrouche,

Ruiliang YanAuthors Info & Claims

Volume 214, Issue C

https://doi.org/10.1016/j.eswa.2022.119135

Published: 15 March 2023 Publication History

Highlights

•

Profitable service strategies in the context of Online-to-Offline competition.

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Combining revenue-sharing and service strategies for Online-to-Offline competition.

•

The importance of full control of offline service management for the retailer.

•

Role of service effectiveness, fair revenue-sharing, and online channel preference.

Abstract

The use of service strategies to lessen the competition between the manufacturer’s online store and the physical retailer is lacking seminal research studies in nowadays’ e-commerce age. To fill this gap, we investigate various service strategies and valuable coordination mechanisms in alleviating online to offline (O2O) competition. Our main results demonstrate that the retailer would not accept free monetary support from the manufacturer and would not accept sharing the cost of the offline service with the manufacturer. Instead, he always prefers to pay fully for his offline service. In addition, it is not beneficial for the manufacturer to invest in online service given that it worsens the competition between the manufacturer’s online store and the physical retailer. Compared to revenue sharing, a strategy widely used in business practices, it is beneficial for the retailer to pay fully for the cost of the offline service instead of participating in the revenue sharing. Thus, we combine the cooperation mechanism (revenue sharing) and the differentiation strategy (offline service paid by the retailer) to form a new mechanism that has a competitive advantage to coordinate the O2O competition. However, this new mechanism may not always be better than using only the service differentiation strategy. The choice of the optimal strategy to coordinate the O2O competition depends on key factors namely the service effectiveness, the shared portion of the retailer’s revenue, and the online channel preference.

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Cited By

He PShi VZhang JChen X(2024)Channel strategy and the management of fake reviews in a catering platform service supply chainExpert Systems with Applications: An International Journal10.1016/j.eswa.2023.122824243:COnline publication date: 25-Jun-2024
https://dl.acm.org/doi/10.1016/j.eswa.2023.122824
Huang SXu JGao YChen Y(2024)Manufacturer selling channel structure choice under retailer demand-enhancement investment with dual-purpose firmsExpert Systems with Applications: An International Journal10.1016/j.eswa.2023.122726242:COnline publication date: 16-May-2024
https://dl.acm.org/doi/10.1016/j.eswa.2023.122726

Index Terms

Service strategies and channel coordination in the age of E-commerce

Index terms have been assigned to the content through auto-classification.

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Published In

cover image Expert Systems with Applications: An International Journal

Expert Systems with Applications: An International Journal Volume 214, Issue C

Mar 2023

1471 pages

ISSN:0957-4174

Issue’s Table of Contents

Elsevier Ltd.

Publisher

Pergamon Press, Inc.

United States

Publication History

Published: 15 March 2023

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Cited By

He PShi VZhang JChen X(2024)Channel strategy and the management of fake reviews in a catering platform service supply chainExpert Systems with Applications: An International Journal10.1016/j.eswa.2023.122824243:COnline publication date: 25-Jun-2024
https://dl.acm.org/doi/10.1016/j.eswa.2023.122824
Huang SXu JGao YChen Y(2024)Manufacturer selling channel structure choice under retailer demand-enhancement investment with dual-purpose firmsExpert Systems with Applications: An International Journal10.1016/j.eswa.2023.122726242:COnline publication date: 16-May-2024
https://dl.acm.org/doi/10.1016/j.eswa.2023.122726

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