63 / 2024-04-18 11:57:15

Base on Recommender System , Channel Selection of Competing Manufacturers

Channel selection,Recommender System

Abstract. Problem definition: This paper investigate the channel choice problem on competing manufacturers by considering a scenario where two competing manufacturers sell their products through a common retail platform under a combination of two sales models, A-A and A-W, where the e-commerce platform will provide recommendation services to enhance the sales demand for their products. Methodology: We employ a game-theoretic model to study equilibrium channel choice, wholesale prices, and pricing decisions. We also perform sensitivity analysis to assess the impact of some parameters on the equilibrium. Results: We solve and validate the model to derive the conditions for reaching equilibrium in each of the scenarios with a combination of A-A and A-W sales models. Three problems are answered: How would the platform choose the recommendation service for the different sales models of the manufacturers? In what way will manufacturers enter market in the scenario based on platform recommendation? How does the optimal solution of both the manufacturer's different entry modes and the platform's recommendations affect consumers? Our analysis emphasizes the flexibility of different sales models for firms in channel choice when entering the market, which may be a motivation for online retail platforms to offer recommendation services. Management implications: Our research provides business managers with useful insights into the supply chain in which competing manufacturers sell through online retail platforms and make channel selection decisions.