چکیده مقاله
Online retailers routinely use price promotions to stimulate demand, yet the dynamic interactions between discount depth, fulfilment capacity, customer experience and profit remain poorly understood This paper develops a system dynamics model of a pure play online retailer of consumer goods to examine how percentage discounts propagate through operational and behavioral feedback loops The model links promotion intensity to order intake, backlog, lead time, cancellations, customer experience, satisfaction, trust, electronic word of mouth, information quality and an endogenous reference price index We simulate five policies over a two year horizon: a no promotion baseline, 15%, 30% and 40% discounts during weeks 20–40, and a 30% discount combined with a 20% temporary capacity increase Results show that deeper discounts reliably generate higher order intake, but when capacity is fixed, 30% and especially 40% campaigns create substantial backlogs, longer lead times, increased cancellations and deteriorating experience and trust These effects, together with reference price erosion, depress weekly profit during the campaign and leave the 40% strategy with the lowest cumulative profit overall despite the largest sales volume A moderate 15% discount avoids congestion but produces only modest gains Within the simulated scenario set, the most robust policy is a coordinated 30% discount with additional capacity, which maintains service level, sustains experience and trust, and delivers the highest long run cumulative profit The study highlights promotions as system interventions: discount depth and capacity alignment, not price alone, determine whether campaigns are profitable or self defeating, and the model offers a virtual laboratory for testing promotion–capacity strategies before implementation
کلیدواژهها
نویسندگان
Mohammad Saeedi
Ph D Student, Faculty of Industrial and Systems Engineering, Tarbiat Modares University, Tehran, Iran
Nasim Nahavandi
Professor, Faculty of Industrial and Systems Engineering, Tarbiat Modares University, Tehran, Iran
Amir Albadvi
Professor, Faculty of Industrial and Systems Engineering, Tarbiat Modares University, Tehran, Iran
شیوه ارجاع
Saeedi, Mohammad and Nahavandi, Nasim and Albadvi, Amir,1404,Discount Depth, Service Capacity and Long-Run Profit: A System Dynamics Study of Online Retail Promotions,The 4th systems thinking in practice conference,Mashhad
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مجموعه مقالات چهارمین کنفرانس بین المللی تفکر سیستمی در عمل12 آذر 1404 · مشهد