Leveraging blockchain to optimize online strategies for remanufactured products with cannibalization

Abstract

Remanufacturing faces significant challenges including negative consumer perception and the complex dynamics of cannibalization between new and remanufactured product sales. This paper explores the potential of blockchain technology to enhance consumer value perceptions of remanufactured products and presents a decision-making framework that examines both blockchain adoption strategies and online sales channel strategies. Through theoretical analysis using game theory models and numerical analysis of real-world data, the study analyzes the optimal channel strategies and blockchain implementation. The results indicate that a mixed strategy, where manufacturers and platforms collaborate, is highly helpful for promoting the remanufactured market and usually has greater profits. Additionally, an agency–agency strategy, where the manufacturer and platform both leverage blockchain, can help mitigate the cannibalization effects. However, we find that only when consumers’ initial environmental awareness reaches a certain threshold can blockchain effectively promote the remanufactured market. To demonstrate the practical implications, we apply the framework to the remanufactured products on the JD.com and Amazon platforms. The results show that by transitioning to a mixed strategy, the overall profits for the brands can increase. Furthermore, the application of blockchain strategy can lead to further increases in the sales volume of remanufactured products and overall profitability. The paper concludes with managerial insights for fostering sustainable remanufacturing operations through leveraging blockchain technology and optimizing online sales channel strategies.