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Articles

Marketing Time Strategy of Advance Selling for Perishable Goods

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  • 1. School of business, Central South University, Changsha 410083, China;
    2. Hunan University of Commerce, Changsha 410205, China

Received date: 2015-12-29

  Revised date: 2016-05-19

  Online published: 2017-08-26

Abstract

In the era of internet and e-commerce, many products and service providers are beginning to adopt advance selling, such as ticket sales and hotel reservation. In this paper, the focus is put on the marketing time strategy of the perishable goods sales in advance selling. The perishable goods has a fixed consumption stage, and thedemand exceeds the supply in many times because of marketing activities and limited supply capacity. The consumer's utility, which is influenced by the uncertainty of advance selling and the risk of stock out in spot selling, varies with marketing time. The seller's cost is influenced by the two marketing stages and their interaction. A two-stage timing strategy model is proposed for advance selling and spot selling regarding price andcapacity as exogenous. Then the retailer's best timing strategy is analyzed, which refers to the time length of advance selling and when to start the spot selling and the time length of it. Whether there is advance volume constrained or not, the retailer's timing strategy varies, also the profit. The results show that: (1) if there is no capacity constraint in advance selling, when only advance selling exists, the time length of advance selling increases with the price of advance selling; when advance selling and spot selling both exist, consumers are only supposed to buy at a good state, the time length of the both stages is related to the consumption stateand the time sensitivity and the probability of getting goods. Besides, the good state is more likely to occur, consumers are more likely to purchase in advance selling. Otherwise the time length is determined by the time sensitivity and the probability of getting goods, and the marketing time changes reversibly with the probability of getting the goods.(2) if there is capacity constraint in advance selling, when advance price is lower than spot price and the capacity can't meet advance demand, the length of advance selling becomes shorter, but more profit the retailer can get. An optimal timing strategy creatively in advance selling is proposed. In addition, our study make a major step forward in the research on advance selling of perishable goods, especially incases where the retailer pays attention to the marketing time.

Cite this article

ZHOU Xiong-wei, LI Jun, CAI Dan, CHEN Xiao-hong . Marketing Time Strategy of Advance Selling for Perishable Goods[J]. Chinese Journal of Management Science, 2017 , 25(6) : 91 -100 . DOI: 10.16381/j.cnki.issn1003-207x.2017.06.010

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