Abstract
This work considers various aspects of the interaction between the manufacturing and retailing echelon of a supply chain, whereby special attention is paid to marketing instruments used to influence customer demand. This includes the determination of each individual firms’ prices and advertising expenditures on the one hand, but also a special form of cooperation that is called vertical cooperative advertising on the other hand. The latter refers to a financial support program which manufacturers offer to their retailers in order to increase their advertising expenditures. Commonly, the support consists of a certain percentage of the advertising cost called participation rate. Obviously, setting this rate correctly is a very difficult task, which includes not only an estimation of the retailers’ and customers’ behavior, but also of the trade-off between related costs and additionally generated profit. Further complexity arises from the interdependencies between the different firms belonging to a supply chain and their decisions made regarding pricing and advertising.
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Notes
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As explained in Sect. 3.3.1, the accrual rate denotes an upper limit of total financial support, which is often related to the last year’s sales. In practice, this is a common element of cooperative advertising programs.
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Aust, G. (2015). Résumé. In: Vertical Cooperative Advertising in Supply Chain Management. Contributions to Management Science. Springer, Cham. https://doi.org/10.1007/978-3-319-11626-6_7
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DOI: https://doi.org/10.1007/978-3-319-11626-6_7
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