Online selling mode choice and pricing in an O2O tourism supply chain considering corporate social responsibility

Abstract

Abstract This paper considers an online-to-offline (O2O) tourism supply chain (TSC) consisting of an offline tourism service provider (TSP) and an online travel agency (OTA) who has a corporate social responsibility (CSR). We investigate three possible online selling modes: (1) the OTA purchases products from the TSP and sells them to end tourists (Mode R); (2) the OTA charges the TSP a profit-sharing rate (Mode M); (3) the TSP sells products through both the reselling and marketplace channels (Mode D). Based on these three modes, we establish three game-theoretic models to explore the optimal online selling mode and pricing decisions for the TSC and its members. Our analyses and results show that when Mode D is unavailable: if OTA’s cost advantage is relatively low, the TSC members should set a moderate profit-sharing rate and choose Mode M; Conversely, Mode R is better for them under a moderate or not too high profit-sharing rate. When Mode D is also available: Mode M is always worse than Mode D, while Mode R may be better than Mode D under some conditions. Furthermore, we conduct numerical studies and sensitivity analyses, which demonstrate that in Mode D, the TSC should pay more attention to CSR and improve consumers’ channel acceptance for the reselling channel to create more total utility.