Abstract: Nowadays, the channel expansion of internet retail brand merchant from online to offline is common phenomenon in the ecommerce industry. The brand merchant with online and offline direct channels can choose to release the new product through either a single channel or dual channels. It focuses on the optimal strategy of new product release before and after the brand merchant’s channel expansion in this paper, and the optimal combination of product quality, price and channel selection strategy and related factors that affect the optimal strategy when the brand merchant introduces the new product are studied. It is found that there are a variety of strategy combinations for the new product introduction, and the optimal one is affected by the factor such as the uncertainty of customers’ perception of the new product, online shopping revenue, and the channel threshold profit; The strategy of using dual channels to release the new product simultaneously is not always the best, and it may become the optimal one if and only if it matches the corresponding new product quality and price strategy; Compared to the online channel, since the offline channel could deliver more accurate information of the new product value to the customers, hence the brand merchant is more inclined to release new products with high quality and high price through the offline channel; For the internet retail brand merchant, if the digital attribute of the products they operate is weak, channel expansion will bring much benefit to them.

Key words: new product operation; channel selection; quality; pricing