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Display slot auctions in brick-and-mortar retail stores

Author

Listed:
  • Alejandro Lim

    (Scimatica LLC)

  • Lanshan Han

    (NielsenIQ Retailer Products Research, Development)

  • Alvin Lim

    (Emory University Goizueta Business School
    Scimatica LLC)

Abstract

We propose display slot auction mechanisms for brick-and-mortar retail stores under both single- and multiple-period settings to determine true market values for a currently private space. The proposed mechanisms belong to the first-price package auction family, and, unlike traditional auctions, consider not only the bid values in determining allocation, but also the intrinsic values to the retailer of the potentially displayed products. For the single-period case, we show that the winner determination problem (WDP) can be solved in polynomial time. For the multiple-period case, we show that the WDP is NP-hard by reducing a multiple-choice knapsack problem into it. Experiments using real-world data demonstrate significant benefits of the proposed auction mechanisms to a retailer.

Suggested Citation

  • Alejandro Lim & Lanshan Han & Alvin Lim, 2025. "Display slot auctions in brick-and-mortar retail stores," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 24(4), pages 380-392, August.
    • Handle: RePEc:pal:jorapm:v:24:y:2025:i:4:d:10.1057_s41272-024-00504-7
    DOI: 10.1057/s41272-024-00504-7
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