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Coordination of price promotions in complementary categories / Maxim Sinitsyn in Management science, Vol. 58 N° 11 (Novembre 2012) 

Public ISBD [article]  in Management science > Vol. 58 N° 11 (Novembre 2012) . - pp. 2076-2094 Titre : Coordination of price promotions in complementary categories Type de document : texte imprimé Auteurs : Maxim Sinitsyn, Auteur Année de publication : 2013 Article en page(s) : pp. 2076-2094 Note générale : Management Langues : Anglais (eng) Mots-clés : Price  promotions  Complementary  products  Heterogeneous  consumers Résumé : In this paper, I investigate the outcome of a price competition between two firms, each producing two complementary products. Specifically, I study each firm's decision to coordinate price promotions of its products. Consumers are divided into loyals, who purchase both products from their preferred firm, and heterogeneous switchers, who choose between four possible bundles or buy a product in a single category. The switchers are willing to pay some price premium in order to purchase two complementary products that share the same brand name and are produced by the same firm, because they believe that these products are a better match than two complementary products with different brand names. I find that each firm predominantly promotes its complementary products together. This finding is correlationally supported by data in the shampoo and conditioner and in the cake mix and cake frosting categories. ISSN : 0025-1909 En ligne : http://mansci.journal.informs.org/content/58/11/2076.abstract [article] Coordination of price promotions in complementary categories [texte imprimé] / Maxim Sinitsyn, Auteur . - 2013 . - pp. 2076-2094. Management Langues : Anglais (eng) in Management science > Vol. 58 N° 11 (Novembre 2012) . - pp. 2076-2094 Mots-clés : Price  promotions  Complementary  products  Heterogeneous  consumers Résumé : In this paper, I investigate the outcome of a price competition between two firms, each producing two complementary products. Specifically, I study each firm's decision to coordinate price promotions of its products. Consumers are divided into loyals, who purchase both products from their preferred firm, and heterogeneous switchers, who choose between four possible bundles or buy a product in a single category. The switchers are willing to pay some price premium in order to purchase two complementary products that share the same brand name and are produced by the same firm, because they believe that these products are a better match than two complementary products with different brand names. I find that each firm predominantly promotes its complementary products together. This finding is correlationally supported by data in the shampoo and conditioner and in the cake mix and cake frosting categories. ISSN : 0025-1909 En ligne : http://mansci.journal.informs.org/content/58/11/2076.abstract