Optimal uniform pricing and return policies for channel strategies in E-commerce age

From a firm´s perspective, there are three optional channel strategies (i.e. Bricks-only, Clicks-only and Bricks & Clicks) to fulfill the customer demands in E-commerce age. We use two-stage Stackelberg games where the manufacturer as a leader and her retailer as a follower to develop relative profit-maximization models and then to jointly obtain optimal policies for their retail prices and return policies under three channel scenarios respectively. Our numerical analysis further discusses the firms´ channel strategy preferences to obtain a few managerial insights into marketing and operational strategies. Finally, we discuss several future research directions.