Coordinating a platform supply chain with reference promotion effect and Big Data marketing

Abstract

In this paper, the differential game model is constructed to study the coordination problem of platform supply chain by introducing the impacts of Big Data marketing and reference promotion effect on consumer conversion rate. Firstly, the optimal strategies and the profits under centralized and decentralized modes are given by applying the optimal control theory, and the comparative analyses are carried out. Subsequently, in order to coordinate the platform supply chain, a combined contract including a two-part tariff scheme and a promotion cost sharing scheme is designed. Finally, the effects of system parameters on equilibrium strategies and coordination contract are analyzed. The results show that the respective decisions of the manufacturer and the e-commerce platform as well as the total profit of the supply chain are higher under centralized mode. Moreover, within the feasible region, the combined contract not only achieves channel coordination but also improves the economic situations of channel members. It can be also observed that the coordination capacity of the proposed contract reduces with an increase in the memory parameter and improves with an increase in parameters such as the effectiveness of the Big Data marketing and the effectiveness of the reference promotion effect.