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Brand and Channel Effect on the Equilibrium Channel and Advertising Strategies for Duopoly Firms
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The advent of e-commerce has prompted manufactures to redesign and change the traditional supply-chains and relationships. For manufactures, they could sell product to the end customer directly by internet as well as avoid middle retailers fighting against them by double marginalization. Moreover, the trend means not only increasing the channel to the target market but also reducing the advertising cost of company. For this reason, our research brings the competition between manufactures and retailers to our decision variable. We hope the outcome could give company some advice on building channel structures through the research. We construct a dynamic game theory basic model. In our model, we assume that two duopoly manufactures and its retailers in the market. Afterwards, we consider the brand substitution effects and channel substitution effects. The result indicates that two manufactures own the three channels choices, however, it only turn up four equilibrium channel structures. In the extension model, we consider substation effects similarly, and add the advertising effect in our decision variable. The result indicates that it has no significant impact under the advertising effect. For this reason, we further analyze the demand on advertising effects. The final outcome not only indicates that the manufactures dominant strategy is choosing the direct channel strategy in any case but found that the direct channel strategy has affected by substitution effect variation and competitor vulnerably.
|Appears in Collections:||企業管理學系所|
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