The Design and Introduction of Product Lines When Consumer Valuations are Uncertain

• 成果类型: Article
• 署名作者: Biyalogorsky, Eyal; Koenigsberg, Oded
• 署名单位: Reichman University; University of London; London Business School
• 刊物名称: PRODUCTION AND OPERATIONS MANAGEMENT
• ISSN/ISSBN: 1059-1478
• DOI: 10.1111/poms.12167
• 发表日期: 2014
• 页码: 1539-1548
• 关键词: product line; PRODUCT INTRODUCTION; introduction strategy; Demand uncertainty

摘要

This article presents a model of the design and introduction of a product line when the firm is uncertain about consumer valuations for the products. We find that product line introduction strategy depends on this uncertainty. Specifically, under low levels of uncertainty the firm introduces both models during the first period; under higher levels of uncertainty, the firm prefers sequential introduction and delays design of the second product until the second period. Under intermediate levels of uncertainty the firm's first product should be of lower quality than one produced by a myopic firm that does not take product line effects into consideration. We find that when the firm introduces a product sequentially, the strategy might depend on realized demand. For example, if realized demand is high, the firm's second product should be a higher-end model; if demand turns out to be low, the firm's second product should be a lower-end model or replace the first product with a lower-end model.