Pricing Strategies under Behavioral Observational Learning in Social Networks

• 成果类型: Article
• 署名作者: Qiu, Liangfei; Whinston, Andrew B.
• 署名单位: State University System of Florida; University of Florida; University of Texas System; University of Texas Austin
• 刊物名称: PRODUCTION AND OPERATIONS MANAGEMENT
• ISSN/ISSBN: 1059-1478
• DOI: 10.1111/poms.12693
• 发表日期: 2017
• 页码: 1249-1267
• 关键词: Observational learning; social networks; optimal pricing; pricing strategy

摘要

The increasing pervasiveness of social networks allows users to share purchase behaviors with their online friends. In this study, we examine optimal pricing strategies of a monopolistic firm using an analytical model that accounts for behavioral observational learning in social networks. We show that a seller could potentially control the information available to future customers and induce behavioral observational learning, using an information-revealing pricing strategy. This result suggests that offering introductory discounts is not always an effective method to boost purchases in social networks. It could prevent the behavioral observational learning that would increase future customers' willingness to pay.