【学术视点】通过使用现金返还网站增加零售商的忠诚度

Ye Qiu, Ram C. Rao

Marketing Science, Vol. 39

Recommend reason

The research finds that the cash back site can allow retailers to profitably  eliminate consumer search and that makes retailer sites more sticky. Thus, cash  back sites can act as strategic partners of retailers. Surprisingly, even  consumers that use the cash back site can be worse off in the presence of cash  back sites under some conditions. In particular, if search prevention is  profitable even without a cash back site, then cash back sites result in higher  prices to consumers. The research also offers practical guidance through the  finding that the optimal discount offer should be proportional to price rather  than a flat sum.

About the author

Ye Qiu, Tongji SEM

Ram C. Rao, the University of Texas at Dallas

Keywords

E-commerce; discounts; consumer search; pricing; game theory

Brief introduction

Online cash back is a new type of reward for consumers who make a purchase  via affiliated links provided by cash back websites. An interesting aspect of  these sites is that a retailer may be found on all of them. For example, we see  that Walmart appears on all sites, though the cash back rebate rate is no  identical across sites. Moreover, these sites often list more than 2,000  retailers, including large merchants like Walmart, Amazon, eBay, and Macy’s,  offering cash back. Our goal in this research is to explore the strategic role  of cash back websites. In this paper, we develop a model of cash back sites,  consumer search, and retailer pricing and, by analyzing it, provide answers to  the following questions: How does online cash back affect price competition  among retailers? Who benefits from having a third-party website that offers  online cash back? Is it better to have a contract that specifies cash back as a  percentage discount or flat discount? Are equilibrium transaction prices lower  for users of the cash back site compared with a situation without these sites?  The results provided an insight into how the cash back site helps the retailer  to prevent search by consumers that visit the retailer and how it affects  consumers’ welfare in equilibrium. In addition, we are also able to provide a  practical guideline on how best search can be prevented for the retailer.