The Retailer's Cooperative Advertising Strategy based on Stackelberg Game

Abstract

This paper consider the question of whether the one-period two-stage supply chain, made up of a manufacturer and a retailer, is advertised in the Stackelberg game. Market demand is uncertain, the retailers are risk- neutral, and are selling products from manufacturers to consumers. The manufacturers and the retailers carry out Stackelberg game, the Nash equilibrium is obtained under two kinds of situations, the optimal solution and profit under the cooperative advertising is always better than that of the cooperative advertising is not the optimal solution and profits, tell the motive and strategy of the retailer cooperative advertising. Finally, the influence of the sensitivity coefficients on optimal decision is given by numerical examples, the conclusion is also proved.