Pricing Strategies in Presence of Online Consumer Ratings - from the Product Customization Perspective
Abstract:Although there is abundant evidence that online consumer ratings have significant impacts on firms’ pricing strategies, it is unclear how such impacts are influenced by the degree of product customization. This paper sets up a two-period dynamic model to analyze a firm’s...
Guardado en:
| Autores principales: | , , |
|---|---|
| Lenguaje: | English |
| Publicado: |
Universidad de Talca
2020
|
| Materias: | |
| Acceso en línea: | http://www.scielo.cl/scielo.php?script=sci_arttext&pid=S0718-18762020000300107 |
| Etiquetas: |
Agregar Etiqueta
Sin Etiquetas, Sea el primero en etiquetar este registro!
|
| id |
oai:scielo:S0718-18762020000300107 |
|---|---|
| record_format |
dspace |
| spelling |
oai:scielo:S0718-187620200003001072020-07-06Pricing Strategies in Presence of Online Consumer Ratings - from the Product Customization PerspectiveLi,,TianWang,,XueyingWu,Yifan Pricing strategy Product customization Online consumer rating Niche product Neutral product Mainstream product Abstract:Although there is abundant evidence that online consumer ratings have significant impacts on firms’ pricing strategies, it is unclear how such impacts are influenced by the degree of product customization. This paper sets up a two-period dynamic model to analyze a firm’s pricing strategies and the changes in its profitability when it sells products with different customization degrees (i.e., niche, neutral or mainstream). Consumers are uninformed of the product value. However, the first-period consumers generate online consumer ratings after their consumptions, and such ratings enable the second-period consumers to better understand the product value and thus to improve their purchasing decisions. Our results show that, in anticipation of the impacts of online consumer reviews, the firm should adjust its pricing strategy according to the customization degree of its product. In particular, for neutral products, the firm should lower its expected price in the second period comparing to its first period price, but for niche and mainstream products, the pricing adjustments over periods depend on the product value.info:eu-repo/semantics/openAccessUniversidad de TalcaJournal of theoretical and applied electronic commerce research v.15 n.3 20202020-09-01text/htmlhttp://www.scielo.cl/scielo.php?script=sci_arttext&pid=S0718-18762020000300107en10.4067/S0718-18762020000300107 |
| institution |
Scielo Chile |
| collection |
Scielo Chile |
| language |
English |
| topic |
Pricing strategy Product customization Online consumer rating Niche product Neutral product Mainstream product |
| spellingShingle |
Pricing strategy Product customization Online consumer rating Niche product Neutral product Mainstream product Li,,Tian Wang,,Xueying Wu,Yifan Pricing Strategies in Presence of Online Consumer Ratings - from the Product Customization Perspective |
| description |
Abstract:Although there is abundant evidence that online consumer ratings have significant impacts on firms’ pricing strategies, it is unclear how such impacts are influenced by the degree of product customization. This paper sets up a two-period dynamic model to analyze a firm’s pricing strategies and the changes in its profitability when it sells products with different customization degrees (i.e., niche, neutral or mainstream). Consumers are uninformed of the product value. However, the first-period consumers generate online consumer ratings after their consumptions, and such ratings enable the second-period consumers to better understand the product value and thus to improve their purchasing decisions. Our results show that, in anticipation of the impacts of online consumer reviews, the firm should adjust its pricing strategy according to the customization degree of its product. In particular, for neutral products, the firm should lower its expected price in the second period comparing to its first period price, but for niche and mainstream products, the pricing adjustments over periods depend on the product value. |
| author |
Li,,Tian Wang,,Xueying Wu,Yifan |
| author_facet |
Li,,Tian Wang,,Xueying Wu,Yifan |
| author_sort |
Li,,Tian |
| title |
Pricing Strategies in Presence of Online Consumer Ratings - from the Product Customization Perspective |
| title_short |
Pricing Strategies in Presence of Online Consumer Ratings - from the Product Customization Perspective |
| title_full |
Pricing Strategies in Presence of Online Consumer Ratings - from the Product Customization Perspective |
| title_fullStr |
Pricing Strategies in Presence of Online Consumer Ratings - from the Product Customization Perspective |
| title_full_unstemmed |
Pricing Strategies in Presence of Online Consumer Ratings - from the Product Customization Perspective |
| title_sort |
pricing strategies in presence of online consumer ratings - from the product customization perspective |
| publisher |
Universidad de Talca |
| publishDate |
2020 |
| url |
http://www.scielo.cl/scielo.php?script=sci_arttext&pid=S0718-18762020000300107 |
| work_keys_str_mv |
AT litian pricingstrategiesinpresenceofonlineconsumerratingsfromtheproductcustomizationperspective AT wangxueying pricingstrategiesinpresenceofonlineconsumerratingsfromtheproductcustomizationperspective AT wuyifan pricingstrategiesinpresenceofonlineconsumerratingsfromtheproductcustomizationperspective |
| _version_ |
1714202238925144064 |