Download or read book Dynamic Pricing Strategies for New Products with Extended Warranty Contracts written by Shengqiu Zhang and published by Open Dissertation Press. This book was released on 2017-01-27 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation, "Dynamic Pricing Strategies for New Products With Extended Warranty Contracts" by Shengqiu, Zhang, 张盛球, was obtained from The University of Hong Kong (Pokfulam, Hong Kong) and is being sold pursuant to Creative Commons: Attribution 3.0 Hong Kong License. The content of this dissertation has not been altered in any way. We have altered the formatting in order to facilitate the ease of printing and reading of the dissertation. All rights not granted by the above license are retained by the author. Abstract: An extended warranty provides consumers the opportunity to rectify product failures at little or no cost after the expiry of the base warranty. Empirical evidence has shown that the selling of extended warranty contract (EWC) has become a profitable business in many manufacturing and retail industries. This thesis investigates the dynamic pricing problem for a new product with the option of purchasing an extended warranty contract (EWC). The research simultaneously determines the pricing strategies for both the product and the associated EWC, and the production rate to maximize the manufacturer's long-term total profit. The results show that the provision of EWC will significantly affect the optimal pricing strategy for the new product, and may also affect its optimal production plan. The research establishes three mathematical models for making optimal pricing decisions under different operational settings. The first model considers a centralized selling system in which the manufacturer sells the product and offers the associated EWC to the consumer directly. The second model extends the first one by incorporating the production and inventory decisions in the analysis. The third model considers a decentralized system in which the manufacturer sells the new product to consumers through an independent retailer. The EWC can be offered either by the manufacturer or by the retailer. It is shown that each scenario leads to a differential Stackelberg game in which the manufacturer and the retailer are players. For the first model, the Pontryagin maximum principle is used to derive the necessary condition for the optimal pricing strategies for both the new product and the associated EWC. Some properties for pricing the new product optimally are then studied. Apart from analysing the characteristics of the optimal pricing strategy under general demand conditions, closed-form solutions for the problem are also derived for some specific demand functions. In cases where closed-form solutions cannot be found, a gradient algorithm is applied to solve the problem numerically. In the second model, the production rate becomes a decision variable because the unit production cost depends on the chosen production rate. Results of the analysis show that the optimal selling price for the EWC remains the same as that in the first model, while the optimal selling price for the new product are affected by the production rate. The results also show that the gradient algorithm fails to converge, thus is no longer suitable for the second model due to the complexity caused by the boundary conditions. A more robust control vector parameterization method is then developed to compute the numerical solution. Analysing the third model theoretically indicates that some necessary conditions related to the optimal wholesale price and the optimal retail price must be satisfied for the existence of an open-loop Stackelberg equilibrium. Some important managerial insights are derived on the basis of the properties characterizing the optimal solution. The control vector parameterization method is then further developed to solve the differential game problem. Numerical experiments are then carried out to demonstrate which distribution channel results in the largest profit. DOI: 10.5353/th_b5435661 Subjects: Warranty Pricing

Download or read book Dynamic Pricing Strategies for New Products with Extended Warranty Contracts written by 张盛球 and published by . This book was released on 2015 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Designing Menus of Extended Warranty Contracts Under Technological Change and Competition written by Kamonkan Laksana and published by . This book was released on 2007 with total page 188 pages. Available in PDF, EPUB and Kindle. Book excerpt: Extended warranties provide "piece of mind" to a consumer in that product failures which occur after the base warranty expires are rectified at little or no cost. They also provide an additional source of revenue for manufacturers or third party providers. We analyze a number of extended warranty contracts which differ in design, including restrictions on deferrals and renewals. With the use of dynamic programming, we compute the optimal strategy for a consumer with perfect information and determine the optimal pricing policy for the provider given the consumer's risk characterization. We illustrate how profits can be dramatically increased by offering menus of extended warranty contracts, as opposed to stand alone contracts, with the use of integer programming. Extensions of this work utilize the dynamic programming approach to examine the consumer's behavior in light of technological change (improvement in the product's reliability) and competition for service contracts from multiple providers. This information provides input to an original equipment manufacturer as to how they should plan product improvement programs when refreshing designs. The investment cost, warranty period, and market conditions are crucial factors for determining the optimal design refresh program from a manufacturer's perspective.

Download or read book An Aspect of New Product Planning written by Abel P. Jeuland and published by . This book was released on 1979* with total page 33 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Dynamic pricing strategy for new consumer durables written by Pil Hwa Yoo and published by . This book was released on 1987 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Dynamic Pricing and Warranty Policies for Products with Fixed Lifetime written by Zhefang Zhou and published by . This book was released on 2006 with total page 113 pages. Available in PDF, EPUB and Kindle. Book excerpt: Product warranties have been an integral part of production and marketing strategies for a manufacturer to gain market shares and control quality related costs. Since offering aggressive warranty polices could result in a very high cost to a manufacturer, effective design of warranty policies is crucial for him to succeed in today's competitive world.

Download or read book Pricing Strategies For New Products written by Maria Octoviany and published by . This book was released on 2023 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Business is something that is complicated in living it. When a business is built, there will be new product products produced and when the product can be produced, the way to sell it is by setting an effective price so that it can cause customer interest to be able to buy the products that the business produces. Therefore, price is something crucial that needs to be considered the most and needs to use various strategies so that later the output produced can really be maximized. In this article, we will discuss what factors need to be considered in setting prices and also 8 strategies for applying prices to new product products that can be used as a foundation in a business. The strategies are: 1) Loss Leader Pricing, 2) Competition Based-Pricing, 3) Dynamic Pricing, 4) High Low Pricing, 5) Basing Point Pricing, 6) Captive Pricing, 7) Skimming Pricing, 8) Penetration Pricing,9) Keystone Pricing,10) Market based pricing.

Download or read book Pricing Strategies For New Products A Complete Guide 2020 Edition written by Gerardus Blokdyk and published by 5starcooks. This book was released on 2019-10-23 with total page 310 pages. Available in PDF, EPUB and Kindle. Book excerpt: Does the internet make markets more competitive? When do you raise and when do you lower your price? What price should you charge for your new product? What type of pricing strategy is your competitor following? Do prices rise during periods of peak demand? This instant Pricing Strategies For New Products self-assessment will make you the entrusted Pricing Strategies For New Products domain visionary by revealing just what you need to know to be fluent and ready for any Pricing Strategies For New Products challenge. How do I reduce the effort in the Pricing Strategies For New Products work to be done to get problems solved? How can I ensure that plans of action include every Pricing Strategies For New Products task and that every Pricing Strategies For New Products outcome is in place? How will I save time investigating strategic and tactical options and ensuring Pricing Strategies For New Products costs are low? How can I deliver tailored Pricing Strategies For New Products advice instantly with structured going-forward plans? There's no better guide through these mind-expanding questions than acclaimed best-selling author Gerard Blokdyk. Blokdyk ensures all Pricing Strategies For New Products essentials are covered, from every angle: the Pricing Strategies For New Products self-assessment shows succinctly and clearly that what needs to be clarified to organize the required activities and processes so that Pricing Strategies For New Products outcomes are achieved. Contains extensive criteria grounded in past and current successful projects and activities by experienced Pricing Strategies For New Products practitioners. Their mastery, combined with the easy elegance of the self-assessment, provides its superior value to you in knowing how to ensure the outcome of any efforts in Pricing Strategies For New Products are maximized with professional results. Your purchase includes access details to the Pricing Strategies For New Products self-assessment dashboard download which gives you your dynamically prioritized projects-ready tool and shows you exactly what to do next. Your exclusive instant access details can be found in your book. You will receive the following contents with New and Updated specific criteria: - The latest quick edition of the book in PDF - The latest complete edition of the book in PDF, which criteria correspond to the criteria in... - The Self-Assessment Excel Dashboard - Example pre-filled Self-Assessment Excel Dashboard to get familiar with results generation - In-depth and specific Pricing Strategies For New Products Checklists - Project management checklists and templates to assist with implementation INCLUDES LIFETIME SELF ASSESSMENT UPDATES Every self assessment comes with Lifetime Updates and Lifetime Free Updated Books. Lifetime Updates is an industry-first feature which allows you to receive verified self assessment updates, ensuring you always have the most accurate information at your fingertips.

Download or read book Dynamic Pricing Strategy for New Consumer Durables written by Pil H. Yoo and published by . This book was released on 1987 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Dynamic Pricing and Procurement with Buy One Get One Promotions written by Yuefeng Li and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Strategic inventory plays a vital role in a manufacturer-retailer dynamic contract. By holding inventories in a period, the retailer curtails the manufacturer's pricing power in the next period and alleviates double marginalization, significantly increasing the manufacturer's and retailer's profits and improving consumer surplus. The retailer's strategic inventory stems from strategic consideration (dynamic games) regardless of uncertainties, fluctuations, capacities, etc. In this paper, we investigate how consumers' strategic inventory (i.e., consumer stockpiling) alters the retailer's strategic inventory as well as the subgame perfect equilibrium. We extend the model of Anand et al. (2008) by adding Buy-One-Get-One (BOGO) promotions in the first period. We show that the retailer has a strong motive to transfer inventory to consumers. Our results hold if consumers are myopic or strategic and anticipate the price in the second period. We also examine our results in a multi-period model over a finite horizon. To compare BOGO to cash-mail-in rebates, we study a manufacturer-to-consumer BOGO in such a dynamic contract. The result reveals that, unlike rebates, the manufacturer does not offer BOGO to consumers but the retailer does, implying that the pricing scheme with BOGO differs from rebates. Finally, we extend our base model to three production cost structures: (1) fixed setup cost; (2) diseconomies of scale; and (3) production cost savings, and find that the cost structure has a significant impact on the optimal supply chain inventory and BOGO promotions decisions.

Download or read book Dynamic Pricing Strategies in the Presence of Demand Shifts written by Omar Besbes and published by . This book was released on 2016 with total page 33 pages. Available in PDF, EPUB and Kindle. Book excerpt: Many factors introduce the prospect of changes in the demand environment that a firm faces, with the specifics of such changes not necessarily known in advance. If and when realized, such changes affect the delicate balance between demand and supply and thus current prices should account for these future possibilities. We study the dynamic pricing problem of a retailer facing the prospect of a change in the demand function during a finite selling season with no inventory replenishment opportunity. In particular, the time of the change and the postchange demand function are unknown upfront, and we focus on the fundamental trade-off between collecting revenues from current demand and doing so for postchange demand, with the capacity constraint introducing the main tension. We develop a formulation that allows for isolating the role of dynamic pricing in balancing inventory consumption throughout the horizon. We establish that, in many settings, optimal pricing policies follow a monotone path up to the change in demand. We show how one may compare upfront the attractiveness of pre- and postchange demand conditions and how such a comparison depends on the problem primitives. We further analyze the impact of the model inputs on the optimal policy and its structure, ranging from the impact of model parameter changes to the impact of different representations of uncertainty about future demand.

Download or read book Dynamic Pricing with Reference Price Effects written by and published by . This book was released on 2015 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Dynamic Pricing and Replenishment with Customer Upgrades written by Oben Ceryan and published by . This book was released on 2017 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: We study a joint implementation of price- and availability-based product substitution to better match demand and constrained supply across vertically differentiated products. Our study is motivated by firms that utilize dynamic pricing as well as customer upgrades, as ex-ante and ex-post mechanisms, respectively, to mitigate inventory mismatches. To gain insight into how offering product upgrades impacts optimal price selection, we formulate a multiple period, nested two-stage model where the firm first sets prices and replenishment levels for each product while the demand is still uncertain, and after observing the demand, decides how many (if any) of the customers to upgrade to a higher quality product. We characterize the structure of the optimal upgrade, pricing and replenishment policies and find that firms having greater flexibility to offer product upgrades can restrain their reliance on dynamic pricing, enabling them to better protect the price differentiation between the products. We also show how the quality differential between the products or changes in the replenishment cost structures influence the optimal policy. Using insights gained from the optimal policy structure, we construct a heuristic policy and find that it performs well across various parameter values. Finally, we consider an extension in which the firm dynamically sets upgrade fees in each period. Our results overall help further our understanding of the intricate relationship among a firm's decisions on pricing, replenishment, and product upgrades in an effort to better match demand and constrained supply.

Download or read book Dynamic Pricing Strategies for Maximizing Customer Satisfaction written by Hershey H. Friedman and published by . This book was released on 2013 with total page 3 pages. Available in PDF, EPUB and Kindle. Book excerpt: Accountants are often asked for advice on pricing products, and their input is often quite helpful and necessary. Accountants, however, are very likely to focus on costs when trying to advise management on appropriate pricing strategies. Economists might focus on rules for maximizing short-run profits, i.e., set marginal revenue equal to marginal cost. This is because economists are more interested in studying the demand-curve for a product than in focusing on the actual costs; they are concerned with using demand (marginal revenue is derived from the demand curve) to determine the optimum price. Marketing executives, on the other hand, are more likely to focus on the different consumer segments since marketers are attuned to the idea of market segmentation. Market segmentation involves dividing the market into distinct groups of customers, each with their own needs, and considering each as a possible target market. The firm will then decide which segments to target and will provide the selected target markets with different products and/or different marketing mixes. Each of these approaches are valuable in pricing.The purpose of this paper is to introduce accountants to ideas from marketing and economics that can be quite helpful in determining the ideal price to charge for a product or service.

Download or read book Optimal dynamic pricing for new products in the presence of network externalities written by Jinhong Xie and published by . This book was released on 1991 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Multi Product Dynamic Pricing with Reference Effects Under Logit Demand written by Mengzi Amy Guo and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: We consider an infinite-horizon multi-product dynamic pricing problem with reference effects in a monopolistic setting, where the reference price is an exponentially weighted average of historical prices. In each period, the demand follows the multinomial logit (MNL) model, where the utility depends on both the current price and the reference price, and consumers can have product-differentiated sensitivities to the price and the reference price. We conduct thorough analyses of the myopic pricing policy, including its solution, long-run convergence behavior, and performance guarantee compared to the long-term discounted revenue of the optimal pricing policy. Furthermore, we establish the structural properties of the optimal pricing policy. When consumers are loss-neutral towards all products, we explicitly characterize the optimal pricing policy if it converges to a steady state, and based on our characterization we show that the steady state price can be computed efficiently by a binary search. Interestingly, we find that such a convergence behavior of the optimal pricing policy heavily relies on the upper bound of the admissible price range, and a low price upper bound facilitates the policy to converge. In contrast, when consumers are gain-seeking towards all products, we prove that the optimal pricing policy admits no steady state regardless of the price range. Nevertheless, if consumers are only gain-seeking towards certain but not all products, the optimal pricing policy can potentially be convergent. In addition, our numerical experiments show that loss-aversion over all products does not rule out price fluctuations. This finding is at odds with the classic belief on loss-averse consumers and hence, highlights the significance of accounting for cross-product effects through the MNL demand.

Download or read book Dynamic Pricing of Experience Goods in Markets with Demand Uncertainty written by Yu-Hung Chen and published by . This book was released on 2018 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper studies a firm's optimal dynamic pricing strategies for its new experience goods inmarkets where the distribution of consumers' valuations is ex ante unknown. We examine whetherand how the firm facing information asymmetry and demand uncertainty can signal its high qualityand learn market demand through its pricing strategy. First, we find that a high-quality firm cancredibly reveal its true quality in the early period with either a skimming-pricing strategy or apenetration-pricing strategy under different conditions. Second, though a high-quality firm canbenefit more from learning market demand than a low-quality firm, the high-quality firm may inequilibrium adopt a penetration-pricing strategy to forgo the benefit of learning demand in orderto separate from the low-quality firm, who would adopt a skimming strategy to learn marketdemand. Third, although consumers have higher willing-to-pay for a high-quality product, thehigh-quality firm may in equilibrium charge a lower initial price than the low-quality firm. Fourth,interestingly, the high-quality firm may earn higher profits when its initial price is made underdemand uncertainty than under no uncertainty. Lastly, with perfect social learning (i.e., in the laterperiod, all consumers can learn the firm's quality from earlier customers), the high-quality firmcan in equilibrium signal its quality and learn market demand by adopting a skimming strategy.