Research on the pricing coordination polices of manufacturer under multiple-channels conflict

The paper analyzed the channel structure where a manufacturer open up a direct Internet channel retail the product that is in competition with the traditional channel. The paper developed the aggregate demand function under dual channel based on consumer utility, and studied the manufacturer´s pricing policies which is to avid the conflict from the traditional retail. Three pricing coordination solutions was proposed, that is wholesale price are kept as before, retail prices are kept as before, manufacturer chooses wholesale price to maximize profit. The game model was proposed to analyze the profit under different policies. Finally, a numerical experiment was presented to validate the model and attained some perspective results.