Sales Models and Pricing Strategies for Duty-Free Stores Considering Heterogeneous Consumers: A Case Study in Beijing

Abstract

. Tax free industry refers to the tourism service industry that allows specific retailers to sell duty-free goods to inbound and outbound tourists in order to achieve certain political and economic policies and promote the development of tourism consumption, so it is of great theoretical and practical significance to study the sales model and pricing strategy of duty-free stores. This paper advances its basic hypotheses, explores three sales modes of duty-free stores and heterogeneous consumer decision-making behaviour, constructs equilibrium price and revenue level models under different sales modes, establishes the equilibrium decision-making model of pricing strategies under different sales modes of duty-free stores, and conducts numerical simulation analysis. This analysis reveals that (1) the heterogeneous characteristics of high-value and low-value consumers influence the sales patterns of duty-free stores and have an important impact on their pricing strategies; (2) heterogeneous consumers differ substantially in the perceived value of goods in the market, which influences their purchasing patterns, which also has an important impact on the revenue and market share of duty-free stores; and (3) the market shares of high-value consumers and the difference in initial perceived value determine the sales patterns and pricing strategies of duty-free stores and ultimately affect their revenue levels.