Selection and optimization of cooperative advertising strategies in supply chain based on stackelberg game method

Abstract

With the intensification of market competition, the cost of advertising enterprises is increasing, so eventually, advertising may unable to increase the profits of enterprises and bring huge consumptions to enterprises. In this case, cooperative advertising came into being. With the Stackelberg game method, the selection and optimization of cooperative advertising strategies in supply chain were studied. Through the comparative analysis, the related concepts of supply chain competition, the level of cooperative advertising and Stackelberg game were determined; from the structures as two chains that are the non-integrated decision-making and the integrated decision-making, and two chains that are the integrated decision-making and the non-integrated decision-making, the existing problems were modeled and analyzed with the method of Stackelberg game theory; through numerical analysis, the optimal cooperative advertising strategy under the level of horizontal cooperation advertisement for each enterprise in the supply chain was obtained. Theoretical and empirical analysis can provide theoretical supports and model references for the research on strategy selection and optimization of cooperative advertising in other supply chains.