Advertising and pricing strategies for the manufacturer in the presence of brown and green products

2022

PurposeMotivated by consumers' concerns about water resources, this paper studies the interactive impact of advertising efforts and water-saving on corporate profits in apparel supply chains. Moreover, this study attempts to find an effective way to improve the profit of supply chain members under different game scenarios. Therefore, this study explores the game scenarios with considering the cost-sharing contract.Design/methodology/approachThis paper constructs two basic game models considering different market power in the apparel supply chains, and explores the Pareto improvement combined with cost-sharing contracts based on the basic models. Furthermore, this study extends the models by considering cost-saving and non-linear demand.FindingsIn this paper, it can be found that advertising efforts and water-saving have complex interactive relationships. Counter-intuitively, the increase in advertising efforts may increase water savings. Furthermore, it presents a Pareto improvement when considering cost-sharing contracts, and both the manufacturer and the retailer's profits may improve simultaneously. Moreover, it does not affect the main conclusions when consider the effects of cost-saving and non-linear demand.Research limitations/implicationsAlthough some important findings have been reached, this paper can be extended in many ways in the future. For example, the coordination mechanism among supply chain members can be considered and the fair distribution of profits can be studied. Moreover, the influence of the government policies on the optimal strategy, as well as changes in social welfare can be considered.Practical implicationsThis study offers supply chain members the guidelines on coordinating water-saving investment and advertising efforts which provided new insight into the interaction of these two factors in the apparel supply chains. Moreover, it can provide a coordination mechanism for the supply chain members to improve their profits.Social implicationsThis paper explores the interactive relationship between water-saving and advertising efforts. It can not only save more water resources but also enable consumers to enjoy more environmentally friendly apparel products.Originality/valueThe current literature mainly focuses on the impact of advertising efforts on firm profit. However, this paper studies the interaction between advertising efforts and water-saving in apparel supply chains. Furthermore, this study explores the optimal pricing strategies and Pareto improvement by considering cost-sharing contracts. It can provide theoretical and practical guidance for the decision-maker in deciding on advertising and water-saving investment.

Section: Literature Reviewmentioning

confidence: 99%

Optimal pricing strategy considering consumer sensitivity to water-saving and advertising in the apparel supply chains

2022

“…Jamali and Rasti-Barzoki (2018) [ 40 ] examined the pricing and determination of greenness in dual-channel supply chains in which a green product was compared with a non-green product. Shi et al (2021) [ 18 ] studied advertising and green production strategies for green and non-green products and verified that the green advertising decision was likely to be the most effective.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Prior to setting up the suggested model, a few assumptions are put forward: some are intended to enhance the model’s realism, and others are used for simplification purposes. All of them are nonetheless inspired by previous studies in this field [ 18 , 35 , 58 ]. Hence, the following assumptions are made in view of creating a sound mathematical model.…”

Section: Problem Description and Assumptionsmentioning

confidence: 99%

“…It is common for products to be classified as green or non-green based on factors such as the use of eco-friendly materials and green technologies during the production process. Green products will become more appealing to consumers as they become more aware of global environmental sustainability [ 18 ]. Accordingly, it is imperative to investigate the pricing policies for green products and their impact on the supply chain so that businesses can accomplish their sustainable development targets [ 19 ].…”

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

Pricing Policies of Green Dual-Channel Supply Chain with Fairness Concerns and Altruistic Preferences Based on Consumers’ Environmental Awareness and Channel Preference

Epede

2022

IJERPH

Taking into consideration fairness concerns and altruistic preferences of manufacturers, this paper aims to propose a green dual-channel supply chain that incorporates consumers’ environmental awareness (CEA) and channel preference. The purpose of this work is to explore and further compare the optimal outcomes in a green dual-channel supply chain in three scenarios, which are the fairness-neutrality scenario (Model N), the manufacturer is concerned with fairness scenario (Model F), and the manufacturer has altruistic preference (Model A), respectively. The game-theoretical models with different fairness preferences, comparative, and numerical analyses are used to put forward the impacts of consumers’ channel preference and CEA on pricing, profits, and utilities, and to identify the differences in decisional outcomes between the three models. The results indicate that CEA always contributes to developing the green market while adversely affecting common products. Moreover, consumers’ channel preferences might enable the manufacturer and retailer to enhance profitability under certain conditions. The findings also reveal that manufacturer’s fairness concerns can possibly increase the demand for green products but impair the overall performance of the supply chain in general. Moreover, while the manufacturer’s altruistic preference benefits the retailer’s profits, it has a detrimental effect on the performance of the green supply chain. The practical implications of this research come to promote green consumption and increasing consumer awareness of environmental protection are effective ways to develop a green supply chain. It is also important to note that in order to maintain the durability and stability of the sup-ply chain, the manufacturer must maintain a moderate level of fairness preference behaviors so that downstream retailers will remain enthusiastic about establishing long-term relationships.

“…This practice has recently attracted great interest from environmental organizations, business and corporate sectors and educational institutions (Gardas and Navimipour, 2021). Going green has become a strategy regarding public relations and decreased Information Technologies (IT) industries' costs in the present trend (Shi et al ., 2021). Business sustainability concerns and difficulties are exacerbated by the usage of IT and associated technologies.…”

Section: Introductionmentioning

confidence: 99%

How do businesses achieve sustainable success and gain a competitive advantage in the green era?

Zhang

et al. 2022

PurposeTo attain green economic efficiency, small, micro and medium-sized firms must follow environmental paradigms. This research aims to discover the relationship between green intellectual capital, green entrepreneurial orientation, green marketing, green organizational culture and competitive advantage strategies to attain sustainable manufacturing business success.Design/methodology/approachToday, many companies have accepted their responsibilities, that their operations should not harm the environment. This paper aims to discover the relationship between green factors and competitive advantage strategies to succeed in sustainable manufacturing. The employees of the large manufacturing firms in China are the sample population of the present investigation. Through simple random sampling, surveys were distributed via email. The present study was a quantitative analysis. The analytical tool utilized here was structural equation modeling and SmartPLS program applications.FindingsThe empirical outcomes find that green intellectual capital positively influences competitive advantages and sustainable success in business. In addition, the impact of green entrepreneurial orientation on competitive advantages and sustainable success is positive and significant. The findings illustrated that green marketing is an essential factor in competitive advantage and sustainable success in business. Another point is that green organizational culture positively affects competitive advantages and sustainable success. Finally, competitive advantages have significantly affected sustainable success in business.Practical implicationsThe outcomes help specialists enhance their practices to reflect sustainable business efficiency and competitive advantages.Originality/valueThis is the first study that examined businesses' sustainable success and green factors in a comprehensive model and using a specific sample of manufacturing companies based on green technologies.