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A Differential Game of Advertising for National and Store Brands

In: Dynamic Games: Theory and Applications

Author

Listed:
  • Salma Karray
  • Georges Zaccour

Abstract

We consider a differential game model for a marketing channel formed by one manufacturer and one retailer. The latter sells the manufacturer's product and may also introduce a private label at a lower price than the manufacturer's brand. The aim of this paper is twofold. We first assess in a dynamic context the impact of a private label introduction on the players' payoffs. If this is beneficial for the retailer to propose his brand to consumers and detrimental to the manufacturer, we wish then to investigate if a cooperative advertising program could help the manufacturer to mitigate the negative impact of the private label.

Suggested Citation

  • Salma Karray & Georges Zaccour, 2005. "A Differential Game of Advertising for National and Store Brands," Springer Books, in: Alain Haurie & Georges Zaccour (ed.), Dynamic Games: Theory and Applications, chapter 0, pages 213-229, Springer.
    • Handle: RePEc:spr:sprchp:978-0-387-24602-4_11
    DOI: 10.1007/0-387-24602-9_11
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    Citations

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    Cited by:

    1. Amir Farshbaf-Geranmayeh & Masoud Rabbani & Ata Allah Taleizadeh, 2018. "Channel Coordination with Cooperative Advertising Considering Effect of Advertising on Willingness to Pay," Journal of Optimization Theory and Applications, Springer, vol. 176(2), pages 509-525, February.
    2. Karray, Salma & Martín-Herrán, Guiomar & Zaccour, Georges, 2017. "Assessing the profitability of cooperative advertising programs in competing channels," International Journal of Production Economics, Elsevier, vol. 187(C), pages 142-158.
    3. Karray, Salma & Martín-Herrán, Guiomar, 2022. "The impact of a store brand introduction in a supply chain with competing manufacturers: The strategic role of pricing and advertising decision timing," International Journal of Production Economics, Elsevier, vol. 244(C).
    4. Mukherjee, Arka & Chauhan, Satyaveer S., 2021. "The impact of product recall on advertising decisions and firm profit while envisioning crisis or being hazard myopic," European Journal of Operational Research, Elsevier, vol. 288(3), pages 953-970.
    5. Anshuman Chutani & Suresh Sethi, 2012. "Cooperative Advertising in a Dynamic Retail Market Oligopoly," Dynamic Games and Applications, Springer, vol. 2(4), pages 347-375, December.
    6. Qinglong Gou & Juzhi Zhang & Juan Zhang & Liang Liang, 2017. "Nash Equilibria of Co-Operative Advertising Programs with Advertising Threshold Effects," International Journal of Information Technology & Decision Making (IJITDM), World Scientific Publishing Co. Pte. Ltd., vol. 16(04), pages 981-1004, July.
    7. Karray, Salma & Martín-Herrán, Guiomar & Sigué, Simon-Pierre, 2017. "Cooperative advertising for competing manufacturers: The impact of long-term promotional effects," International Journal of Production Economics, Elsevier, vol. 184(C), pages 21-32.
    8. Chenavaz, Régis Y. & Eynan, Amit, 2021. "Advertising, goodwill, and the Veblen effect," European Journal of Operational Research, Elsevier, vol. 289(2), pages 676-682.
    9. Lu, Fuxiao & Tang, Wansheng & Liu, Guowei & Zhang, Jianxiong, 2019. "Cooperative advertising: A way escaping from the prisoner’s dilemma in a supply chain with sticky price," Omega, Elsevier, vol. 86(C), pages 87-106.
    10. Assarzadegan, Parisa & Hejazi, Seyed Reza, 2021. "A game theoretic approach for analyzing the competition between national and store brands by considering store loyalty," Journal of Retailing and Consumer Services, Elsevier, vol. 60(C).
    11. Chutani, Anshuman & Sethi, Suresh P., 2018. "Dynamic cooperative advertising under manufacturer and retailer level competition," European Journal of Operational Research, Elsevier, vol. 268(2), pages 635-652.
    12. Chan, Tat Y. & Narasimhan, Chakravarthi & Yoon, Yeujun, 2017. "Advertising and price competition in a manufacturer-retailer channel," International Journal of Research in Marketing, Elsevier, vol. 34(3), pages 694-716.
    13. Juan Zhang & Qinglong Gou & Susan Li & Zhimin Huang, 2017. "Cooperative Advertising with Accrual Rate in a Dynamic Supply Chain," Dynamic Games and Applications, Springer, vol. 7(1), pages 112-130, March.
    14. Adib Bagh, 2013. "Better Reply Security and Existence of Equilibria in Differential Games," Dynamic Games and Applications, Springer, vol. 3(3), pages 325-340, September.
    15. Mohammad Kazem Sayadi & Ahmad Makui, 2014. "Feedback Nash Equilibrium for Dynamic Brand and Channel Advertising in Dual Channel Supply Chain," Journal of Optimization Theory and Applications, Springer, vol. 161(3), pages 1012-1021, June.
    16. Buratto, Alessandra & Cesaretto, Rudy & De Giovanni, Pietro, 2019. "Consignment contracts with cooperative programs and price discount mechanisms in a dynamic supply chain," International Journal of Production Economics, Elsevier, vol. 218(C), pages 72-82.
    17. He, Yi & Wang, Hang & Guo, Qiang & Xu, Qingyun, 2019. "Coordination through cooperative advertising in a two-period consumer electronics supply chain," Journal of Retailing and Consumer Services, Elsevier, vol. 50(C), pages 179-188.
    18. Aust, Gerhard & Buscher, Udo, 2014. "Cooperative advertising models in supply chain management: A review," European Journal of Operational Research, Elsevier, vol. 234(1), pages 1-14.
    19. Anshuman Chutani & Suresh P. Sethi, 2012. "Optimal Advertising and Pricing in a Dynamic Durable Goods Supply Chain," Journal of Optimization Theory and Applications, Springer, vol. 154(2), pages 615-643, August.
    20. Zhang, Juan & Gou, Qinglong & Liang, Liang & Huang, Zhimin, 2013. "Supply chain coordination through cooperative advertising with reference price effect," Omega, Elsevier, vol. 41(2), pages 345-353.
    21. Jørgensen, Steffen & Zaccour, Georges, 2014. "A survey of game-theoretic models of cooperative advertising," European Journal of Operational Research, Elsevier, vol. 237(1), pages 1-14.
    22. Lu, Lijue & Marín-Solano, Jesús & Navas, Jorge, 2019. "An analysis of efficiency of time-consistent coordination mechanisms in a model of supply chain management," European Journal of Operational Research, Elsevier, vol. 279(1), pages 211-224.

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