Competition between online and offline retailer mass customization
As online sales increase, customers worldwide have different tastes, preferences, and lifestyles. Mass customization enables the offline retailer to satisfy the heterogeneous customer taste preferences. We adopt the Hotelling model to analyze mass customization strategy on the offline retailer to co...
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| Published in | Procedia computer science Vol. 197; pp. 709 - 717 |
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| Main Authors | , , |
| Format | Journal Article |
| Language | English |
| Published |
Elsevier B.V
2022
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| Subjects | |
| Online Access | Get full text |
| ISSN | 1877-0509 1877-0509 |
| DOI | 10.1016/j.procs.2021.12.192 |
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| Abstract | As online sales increase, customers worldwide have different tastes, preferences, and lifestyles. Mass customization enables the offline retailer to satisfy the heterogeneous customer taste preferences. We adopt the Hotelling model to analyze mass customization strategy on the offline retailer to compete with the online retailer that sells the same product. We consider customers’ heterogeneous hassle costs when visiting offline and the online retailer and their heterogeneous taste preferences towards the products. We aim to examine the value of the mass customization to offline retailer. We found that the mass customization strategy can be great way for the offline retailer when competing with the online retailer. The mass customization strategy can be beneficial for the offline retailer’s profits than the non-mass customization strategy in considerations of customer taste preference. We also found that the breadth of the mass customization scope is subject to several factors, including mismatch cost. Mass customization is less effective when its implementation is costly. |
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| AbstractList | As online sales increase, customers worldwide have different tastes, preferences, and lifestyles. Mass customization enables the offline retailer to satisfy the heterogeneous customer taste preferences. We adopt the Hotelling model to analyze mass customization strategy on the offline retailer to compete with the online retailer that sells the same product. We consider customers’ heterogeneous hassle costs when visiting offline and the online retailer and their heterogeneous taste preferences towards the products. We aim to examine the value of the mass customization to offline retailer. We found that the mass customization strategy can be great way for the offline retailer when competing with the online retailer. The mass customization strategy can be beneficial for the offline retailer’s profits than the non-mass customization strategy in considerations of customer taste preference. We also found that the breadth of the mass customization scope is subject to several factors, including mismatch cost. Mass customization is less effective when its implementation is costly. |
| Author | Farista Ananto, Prasasti Karunia Hsieh, Chung-Chi E R, Mahendrawathi |
| Author_xml | – sequence: 1 givenname: Prasasti Karunia surname: Farista Ananto fullname: Farista Ananto, Prasasti Karunia email: prasasti.karunia@gmail.com organization: Department of Industrial & Information Management, National Cheng Kung University, 1 University Road, Tainan 70101, Taiwan, ROC – sequence: 2 givenname: Chung-Chi surname: Hsieh fullname: Hsieh, Chung-Chi organization: Department of Industrial & Information Management, National Cheng Kung University, 1 University Road, Tainan 70101, Taiwan, ROC – sequence: 3 givenname: Mahendrawathi surname: E R fullname: E R, Mahendrawathi organization: Information System Department, Institut Teknologi Sepuluh Nopember, Surabaya and 60111, Indonesia |
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| Cites_doi | 10.1080/01605682.2019.1696154 10.1016/j.omega.2018.08.004 10.1111/poms.12836 10.1287/msom.1070.0155 10.1108/EJM-04-2019-0333 10.1287/mksc.1100.0588 10.1080/00207543.2015.1106019 10.1007/s10479-014-1592-8 10.3390/en13225895 10.2307/2224214 10.1016/j.jbusres.2012.09.007 10.1287/mksc.1060.0199 10.1111/j.1937-5956.2010.01131.x 10.2139/ssrn.1994981 10.1287/mnsc.2017.2764 10.1287/mksc.1080.0456 10.1007/s12076-011-0060-1 10.1016/j.ejor.2019.03.013 10.1080/07408170500346386 10.1016/j.ejor.2015.07.014 10.1016/j.ijpe.2012.03.002 10.1287/isre.2014.0520 10.1287/mnsc.2017.2834 10.1287/mksc.1050.0120 10.1111/deci.12428 10.1016/j.dss.2015.12.007 10.1016/j.ijpe.2019.107527 |
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| Keywords | customer taste preference Competition retail mass customization hotelling model |
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| Title | Competition between online and offline retailer mass customization |
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