The optimal type of online channel considering showrooming

Abstract

Considering the common market phenomenon "showrooming", this paper studies the optimal type of online channel under the supply chain with one manufacturer and two retail channels. There are two types of online channel, which are the reseller channel and the marketplace channel. Our conclusions are as follows. In the presence of showrooming, first, the marketplace channel increases the profit of the supply chain; second, if the platform fee is not high enough, the manufacturer prefers to adopt the marketplace channel; finally, if the platform fee is intermediate, the marketplace channel is a win-win strategy for the manufacturer and the online retailer. In the absence of showrooming, if the platform fee is low enough, the marketplace channel increases the profit of the supply chain; if the platform fee is high enough, the reseller channel increases the profit of the supply chain.