IDEAS home Printed from https://ideas.repec.org/a/eee/ejores/v291y2021i3p1062-1074.html
   My bibliography  Save this article

Partial refunds as a strategic price commitment device in advance selling in a service industry

Author

Listed:
  • Zhang, Zelin
  • Lim, Weishi
  • Cui, Haitao
  • Wang, Ze

Abstract

Over the past decade, consumers’ strategic waiting behavior in anticipation of a price markdown has become increasingly common when advance selling is used. Recently, studies in the durable goods industry show that a partial refund strategy can activate the price-commitment mechanism to counter consumers’ strategic waiting, which is primarily driven by both consumers’ and retailers’ behaviors that discount the future. In this research, we investigate the possibility of using this partial refund strategy in a service industry context in which demand uncertainty and consumption state uncertainty act as major influential factors.

Suggested Citation

  • Zhang, Zelin & Lim, Weishi & Cui, Haitao & Wang, Ze, 2021. "Partial refunds as a strategic price commitment device in advance selling in a service industry," European Journal of Operational Research, Elsevier, vol. 291(3), pages 1062-1074.
    • Handle: RePEc:eee:ejores:v:291:y:2021:i:3:p:1062-1074
    DOI: 10.1016/j.ejor.2020.10.001
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0377221720308602
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ejor.2020.10.001?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Huang, Zongsheng & Huang, Lingchen & Zhao, Yingxue & Meng, Xiaoge, 2021. "Money-back guarantee in the presence of strategic customer behavior," International Journal of Production Economics, Elsevier, vol. 239(C).
    2. Ling Zhao & Anquan Zou & Pin Zhou, 2023. "E‐retailer's dynamic inventory and pricing policy with price‐protection services," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(1), pages 490-501, January.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ejores:v:291:y:2021:i:3:p:1062-1074. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eor .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.