Abstract
E-tailers can impact customers’ order incidence and cart size by offering an attractive shipping fee; they can also influence customers to purchase other products using a recommendation system. This article provides a combined model in which the shipping-fee discount and product recommendations occur jointly to maximize the sales volume of e-tailers. Selection of recommended products and discount of shipping fee are the dynamic issues involving the complexity of business environments. The proposed model first determines the optimal shipping-fee discount to attract customers and then establishes the most suitable product recommendation list to encourage customers to spend more money on other products. Through the use of a shipping-fee discount and simultaneous product recommendations, e-tailers maximize the sales volume. As for consumers, they can always get additional savings from the subsequent shopping process because the product’s shipping fee is lower than the original shipping costs. Experimental results indicate that the proposed approach is feasible and better than alternative methods for achieving sales volume maximization. Furthermore, sensitivity analysis validates the stability of the proposed model in the face of an uncertain environment. Therefore, using the shipping-fee discount and product recommendation system as a united marketing strategy can maximize e-tailers’ sales volume.
Highlights
An explosion of e-business has occurred over the last decade [1]
Different from the collaborative filtering (CF) and content-based filtering (CBF) methods, which are based on the possibility of buying the product, other research focuses on the impact of the recommendation system on the customer’s purchase decision. e researchers explored the reaction of customers to the recommended products [35] and identified the most appropriate products to recommend [36, 37]
To verify the effectiveness of the proposed model, we use a Taobao shop’s data to analyze the improvement effect of the model on e-tailers’ sales volume. e focus of this manuscript is to emphasize the importance of the joint optimization of the discount rate and product recommendation
Summary
An explosion of e-business has occurred over the last decade [1]. In 2019, retail e-commerce sales will expand 27.3%, reaching $1.935 trillion, or 36.6% of total retail sales. How to combine the freight discount with the recommendation system to make consumers buy products instead of giving up the purchase behavior, so as to maximize sales volume for e-tailers? Is model enables an e-tailer to use freight discounts to attract customer traffic and compensates for the loss of profits caused by the shipping-fee discount by enhancing the sales volume of other recommended products; this article mainly focuses on the following three issues:. Is paper provides a valuable model for managers to optimize the use of online functions to serve customers and improve the sales volume of e-tailers. E-tailers can acquire the largest sales volume through the systematic consideration of the relationship between the shipping-fee discounts and product recommendations.
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