2016 INFORMS Annual Meeting Program

WA73

INFORMS Nashville – 2016

WA74 Legends B- Omni Ops Mgt/Marketing I Contributed Session Chair: Xue Li, Tsinghua University, Beijing, China, lix2.11@sem.tsinghua.edu.cn 1 - Equilibrium Analysis On Price-matching Policy For Two Competitive Retailers Jinpeng Xu, Xidian University, 266 Xinglong Section of Xifeng Road, Xi’an, 710126, China, jinpxu@foxmail.com, Yufei Huang Price-matching policy is widely used by retailers as a competitive strategy to stimulate demand. Under this policy, retailers promise to match the lowest price in the market. We consider two retailers selling the same product in their exclusive market and a competitive market. We use a game theoretical model to investigate whether price-matching policy should be offered by the retailers in competition, and how such decisions are influenced by the size of the exclusive and competitive market. Our results show that the retailer with larger exclusive market is more likely to offer the price-matching policy, and the optimal equilibrium strategy depends on the cost of providing price-matching policy. 2 - Keys To Green Product Line Design: Consumer Perceptions, Cost Implications, Price And Quality Optimization Consumers may have opposing perceptions of the green quality (the amount of recycled content in a green product). Naturalite consumers may prefer a green product with some recycled content, while conventional consumers prefer a base product with no recycled content. While the firm can save on material cost by using some recycled content, processing a mixed material input may increase the production cost. Considering these contrasting demand and supply forces, we study a monopolist’s price and quality optimization problem in a product line context and in particular, answer whether/when it is optimal for the monopolist to offer only the green version of the product. 3 - Does Social Image (Pakistani Consumers) Mediate Relationship Between Brand Performance And Brand Attachment For An Imported Cosmetic Brand? Huma Amir, Chairperson Marketing Deptt., Assistant Professor, Inst of Bus Admin- Karachi, Suite # 218, Main Campus, University Road, Karachi, 75270, Pakistan, huma.amir@hotmail.co.uk, Wajid Rizvi Empirical study on cosmetic industry suggests brand performance influences brand attachment ( = .71 p <.05) with explained variance, R2 =.51. Further investigation on whether this relationship is mediated by social image suggests full mediation. When social image was used as mediating variable the direct influence of brand performance on brand attachment reduced from = .71 (p <.05) to = .01 (p >.05) and became insignificant, whereas indirect effect was = .83 (p < .05). After the mediation, variance explained by the model also increased from R2 =.51 to R2 =.71. The model fit indices also show model fit. The sample size was bootstrapped to 5000 to assess mediation effect and also showed full mediation. 4 - Empirical Evidence On The Contagion Effect Of Product Harm Recall Alireza Azimian, Wilfrid Laurier University, 75 University Avenue West,, Unit 103, Waterloo, ON, N2L 3C5, Canada, azim9110@mylaurier.ca, Kevin B Hendricks The results of the studies on the impact of product harm recalls on rivals are quite mixed. Our research explores whether the signal value of the harm, commoditization level of the industry and physical length of the value chain can explain the differences. 5 - Uniform Pricing Vs. Non-uniform Pricing For Branded Variants: Implications For Channel Structure Equilibrium Monire Jalili, PhD Candidate, University of Oregon, 1208 University of Oregon, Eugene, OR, 97403, United States, mjalili@uoregon.edu, Tolga Aydinliyim, Nagesh N Murthy

2 - Exclusivity In Online Advertising Marjan Baghaie, Microsoft, Seattle, WA, 98105, United States, marjanb@microsoft.com, Amin Sayedi, Kinshuk Jerath We investigate auction mechanisms for sponsored search in which advertisers can bid to be displayed exclusively after a keyword search. We find that allowing advertisers to bid for exclusivity can increase the revenue of the search engine because bidders compete not only for positions in the non-exclusive outcome but also for the outcome to be exclusive or non-exclusive. Interestingly, however, under certain conditions, the revenue of the search engine can decrease because competition between outcomes leads to bidders reducing bids for their non- preferred outcome. We also find that, under certain conditions, advertisers have the incentive to bid above their true valuations. 3 - Game-theoretic Modeling Of Players’ Ambiguities On External Factors Jian Yang, Associate Professor, Rutgers University, 1 Washington Park Rm 1084, Newark, NJ, 07102, United States, jyang@business.rutgers.edu We propose a game-theoretic framework that incorporates general ambiguity attitudes on factors external to all players. Our starting point is players’ preferences on payoff-distribution vectors, essentially mappings from states of the world to distributions of payoffs to be received by players. When the preferences possess ever more features, we can gradually add ever more structures to the game. Particular attention is paid to what we shall call the enterprising game, in which players exhibit ambiguity seeking attitudes while betting optimistically on the favorable resolution of ambiguities. 4 - Equilibrium Structure Of Fixed-cost-reducing Alliances When Firms’ Market Power Is Asymmetric\ Edward Anderson, The University of Texas at Austin, Austin, TX, hirosano@fc.ritsumei.ac.jp, Hiroki Sano With the context of alliance formation between semiconductor manufacturers in new technology development, we study how competing firms’ cooperative deci- sions in a new market entry opportunity can be stabilized from a game-theoretic perspective. We discuss the equilibrium alliance structure when firms can be asymmetric in their relative market power while the individual investment cost is symmetric. In a three-firm case, we show that, under certain conditions, the firm with the second highest market power can choose not to enter a new mar- ket while the other two firms cooperatively enter. Chair: Ling Liu, Huazhong U of Science and Technology, 1037 Luoyu Road, Hong Shan District, Wuhan, 430074, China, 182028870@qq.com 1 - Web-based Grocery Retail Business With Order Cancellation And Refund Options Yi Zhang, Shandong Institute of Business and Technology, Yantai, China, iynnezhangyi@foxmail.com, Yang Li, Xiangpei Hu This research is based on a real web-based B2C grocery retail business in China. Customers to this business demand fresh products and efficient delivery, at the same time, want to keep options of cancelling the orders and getting refund. In this study, we aim to derive an effective joint strategy on inventory planning, selling price and the order cancellation charges, which maintains the profitability and sustainability of the business. 2 - A Meta-analytic And Latent Semantic Analysis Approach To Informing Quality Management Xianghui Peng, Assistant Professor, Eastern Washington University, Spokane, WA, United States, xpeng@ewu.edu, Victor R Prybutok A meta-analytic study of empirical Baldrige Quality Award research is conducted. The analysis includes an evaluation of the relationships among award categories. The Baldrige framework is examined using latent semantic analysis to analyze winning applications. We identify opportunities to further develop quality management theory based on the integrated results. 3 - A Capacitated Vehicle Routing Problem With Order Available Time Ling Liu, Huazhong U of Science and Technology, 1037 Luoyu Road, Hong Shan District, Wuhan, 430074, China, 182028870@qq.com The capacitated vehicle routing problem with order available time is considered in this paper, the orders are not available for delivery at the beginning of the planning period. It is observed in the context of integrated production and transportation scheduling. An efficient tabu search algorithm and a genetic algorithm are presented to tackle the problem. WA73 Legends A- Omni Operations Management V Contributed Session

Xue Li, Tsinghua University, Beijing, China, lix2.11@sem.tsinghua.edu.cn, Jian Chen

Traditionally, firms adopt non-uniform pricing to discriminate product prices and improve profitability. However, considering consumers’ concerns of peer-induced price fairness, it is a reasonable choice for a firm to adopt uniform pricing for branded variants. Under these two different pricing strategies, we analyze channel structure equilibrium in a game-theoretic model.

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