Cooperative advertising in a dynamic retail market duopoly


Lunedi' 15 marzo 2010 alle ore 14.30, in Aula 1AD/100 della Torre Archimede, il prof. Suresh P. Sethi (School of Management, The University of Texas at Dallas Richardson TX, USA) terra' un seminario dal titolo "Cooperative advertising in a dynamic retail market duopoly".

Cooperative advertising is an important incentive offered by a manufacturer to influence retailers' promotional decisions. We analyze a retail market duopoly where one or both of competing retailers are supported by the manufacturer in their advertising costs. We model the problem as a Stackelberg differential game in which the manufacturer announces his shares of advertising costs of the two retailers or his participation rates, and the retailers in response play a Nash differential game in choosing their optimal advertising efforts over time. We obtain the feedback equilibrium solution consisting of the optimal advertising policies of the retailers and manufacturer's participation rates. We identify the key drivers that determine the optimal participation rates and, in particular, obtain the conditions under which the manufacturer will support one or both of the retailers. Finally, we analyze the extent to which cooperative advertising coordinates the channel.

Suresh P. Sethi is Charles & Nancy Davidson Distinguished Professor of Operations Management and Director of the Center for Intelligent Supply Networks at The University of Texas at Dallas. He has written 5 books and published more than 300 research papers in the fields of manufacturing and operations management, finance and economics, marketing, and optimization theory. He teaches a course on optimal control theory/applications and organizes a seminar series on operations research topics. He serves on the editorial boards of several journals including Production and Operations Management, SIAM Journal on Control and Optimization, and Automatica. Recent honors include: SIAM Fellow, POMS Fellow (2005), INFORMS Fellow (2003), AAAS Fellow (2003), IEEE Fellow (2001), IITB Distinguished Alum (2008). Two conferences were organized and two books edited in his honor in 2005-6.

Rif. int. A. Buratto

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