Sales promotions and channel coordination

Consumer sales promotions are usually the result of the decisions of two marketing channel parties, the manufacturer and the retailer. In making these decisions, each party normally follows its own interest: i.e. maximizes its own profit. Unfortunately, this results in a suboptimal outcome for the channel as a whole. Independent profit maximization by channel parties leads to a lack of channel coordination with the implication of leaving money on the table. This may well contribute to the notoriously low profitability of sales promotions. This paper first shows analytically why the suboptimality occurs, and then presents an empirical demonstration, using a unique dataset from an Efficient Consumer Response (ECR) project; ECR is a movement in which parties work together to optimize the distribution channel). In this dataset, actual profit is only a small fraction of potential profit, implying that there is a large degree of suboptimality. It is important that (1) channel parties are aware of this suboptimality; and (2) that they have tools to deal with it. Solutions to the channel coordination problem should ensure that the goals of the individual channel parties are aligned with the goals of the channel as a whole. The paper proposes one particular agreement for this purpose, called proportional discount sharing. Application to the ECR data shows a win-win result for both the manufacturer and the retailer. Recognition of the channel coordination problem by the manufacturer and the retailer is the necessary starting point for agreeing on a way of solving it in a win-win fashion

Aligning evidence generation and use across health, development, and environment

© 2019 The Authors Although health, development, and environment challenges are interconnected, evidence remains fractured across sectors due to methodological and conceptual differences in research and practice. Aligned methods are needed to support Sustainable Development Goal advances and similar agendas. The Bridge Collaborative, an emergent research-practice collaboration, presents principles and recommendations that help harmonize methods for evidence generation and use. Recommendations were generated in the context of designing and evaluating evidence of impact for interventions related to five global challenges (stabilizing the global climate, making food production sustainable, decreasing air pollution and respiratory disease, improving sanitation and water security, and solving hunger and malnutrition) and serve as a starting point for further iteration and testing in a broader set of contexts and disciplines. We adopted six principles and emphasize three methodological recommendations: (1) creation of compatible results chains, (2) consideration of all relevant types of evidence, and (3) evaluation of strength of evidence using a unified rubric. We provide detailed suggestions for how these recommendations can be applied in practice, streamlining efforts to apply multi-objective approaches and/or synthesize evidence in multidisciplinary or transdisciplinary teams. These recommendations advance the necessary process of reconciling existing evidence standards in health, development, and environment, and initiate a common basis for integrated evidence generation and use in research, practice, and policy design

Advertising coordination games of a manufacturer and a retailer while introducing a new product

Advertising, Market segmentation, Distribution channel, Nash equilibrium, Stackelberg equilibrium, 49N90, 90B60,