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Customer flow spillovers in retailers' short- and long-term decisions: Profitability and dynamic mechanisms

Author

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  • Bao, Chunyu
  • Li, Min
  • Pei, Yiying

Abstract

A retailer's flow investment may not only attract more customers to itself but also bring additional demand to its competitor, generating flow spillovers. This paper aims to examine the impact of such spillovers on retailers' short- and long-term strategic decisions. We employ a game model for the static analysis of retailers' short-term decisions, and construct a nonlinear dynamic system to explore their long-term decisions. The performance comparison shows that both unilateral and bilateral spillovers enhance retailers' profitability, though investment efficiency differs. We also reveal the long-tail effect of customer flow spillovers and their impact on system stability. Our findings provide retailers with a deeper understanding of profit advantage and potential risks associated with flow spillovers, offering management insights into their customer flow investment and timing strategies.

Suggested Citation

  • Bao, Chunyu & Li, Min & Pei, Yiying, 2026. "Customer flow spillovers in retailers' short- and long-term decisions: Profitability and dynamic mechanisms," Journal of Retailing and Consumer Services, Elsevier, vol. 88(C).
    • Handle: RePEc:eee:joreco:v:88:y:2026:i:c:s0969698925002292
    DOI: 10.1016/j.jretconser.2025.104450
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