IDEAS home Printed from https://ideas.repec.org/a/ids/ijbisy/v45y2024i4p503-518.html
   My bibliography  Save this article

Role of IT capacity in customer churn for electronic retailers in oligopoly market using game theory approach

Author

Listed:
  • Maryam Esmaeili
  • Sahar Vatankhah

Abstract

This paper examines the customer churn for e-retailers in oligopoly markets and simultaneously considers IT capacity and marketing. When customer churn occurs, the customers leave this e-retailer and join other ones. Moreover, the market share of each e-retailer depends on its marketing rate, rival companies, and IT capacity. The competition between the companies is examined in an oligopoly market. The rate of customer reduction is considered to determine the efficient marketing policy leading to maximising each player's profit. The relation between e-retailers is modelled as an infinite horizon, non-cooperative differential game. A differential game theory is employed to obtain the market share, marketing rate, and IT capacity of each e-retailer. Besides, a numerical example and sensitivity analysis are presented to illustrate the proposed model. Finally, it was revealed that the companies do not need to spend money on marketing efforts by prioritising their IT capacity.

Suggested Citation

  • Maryam Esmaeili & Sahar Vatankhah, 2024. "Role of IT capacity in customer churn for electronic retailers in oligopoly market using game theory approach," International Journal of Business Information Systems, Inderscience Enterprises Ltd, vol. 45(4), pages 503-518.
    • Handle: RePEc:ids:ijbisy:v:45:y:2024:i:4:p:503-518
    as

    Download full text from publisher

    File URL: http://www.inderscience.com/link.php?id=138050
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

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

    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:ids:ijbisy:v:45:y:2024:i:4:p:503-518. 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: Sarah Parker (email available below). General contact details of provider: http://www.inderscience.com/browse/index.php?journalID=172 .

    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.