Sales Promotion and Cooperative Retail Pricing Strategies
- Tags:
- Arizona State University,
- Marketing,
- Marketing Research,
- Pricing,
- Pricing Strategy,
- Sales,
- Sales Promotion
- Source:
- Arizona State University
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Overview: Supermarket retailers make strategic pricing decisions in a high-frequency, repeated game environment both in buying and selling fresh produce. In this context, there is some question as to whether a non-cooperative equilibrium can emerge that produces margins above the competitive level. Supermarket pricing results from tacitly collusive equilibria supported by trigger price strategies played in upstream markets. Upstream activities are, in turn, driven by periodic retail price promotions. The authors test this hypothesis using a sample of fresh produce pricing data from 20 supermarket chains in markets distributed throughout the U.S. The results support the existence of tacitly collusive non-cooperative equilibria in upstream and downstream markets.
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Format: PDF | Size: 513KB | Date: Aug 2004 | Pages: 36




