Cyclic Pricing When Customers Queue with Rating Information

• 成果类型: Article
• 署名作者: Huang, Fengfeng; Guo, Pengfei; Wang, Yulan
• 署名单位: University of Electronic Science & Technology of China; Hong Kong Polytechnic University
• 刊物名称: PRODUCTION AND OPERATIONS MANAGEMENT
• ISSN/ISSBN: 1059-1478
• DOI: 10.1111/poms.13052
• 发表日期: 2019
• 页码: 2471-2485
• 关键词: social optimization; strategic behavior; service; equilibrium; QUALITY; rationality; COMPETITION; systems; COSTS

摘要

Consider a situation where a service provider serves two types of customers, sophisticated and naive. Sophisticated customers are well-informed of service-related information and make their joining-or-balking decisions strategically, whereas naive customers do not have such information and rely on online rating information to make such decisions. We demonstrate that under certain conditions a service provider can increase its profitability by simply dancing its price, that is, replacing the static pricing strategy with a high-low cyclic pricing strategy. The success of this strategy relies on two key conditions: the potential market size is large enough so that congestion is a key concern in the service system, and the rating provides the average price and average utility information. Finally, we show that the cyclic pricing strategy is not socially optimal.