Pricing and service capacity allocation strategies for the omni-channel service provider considering fairness

With the development of the mobile Internet, the omni-channel operation model based on local services has been accepted by the majority of service providers and consumers. For service providers with limited service capability, it is necessary to consider the fair allocation of their service capability among different channels. This paper focuses on the service providers with limited service capacity that operate both physical and O2O channel, and explores the channel pricing and service capacity allocation strategies under different allocation mechanisms considering fairness. Through the construction of the consumer utility model, the channel selection behavior of consumers is characterized, and the service pricing strategy under the linear allocation and weighted average allocation mechanism in different channel preference markets and the optimal allocation of service providers are studied. The results show that under the weighted average allocation mechanism, although the service capability is limited, the expansion of the service capacity of the firm may not increase the profit of the service provider; when the service provider's service capability is small, if the weight of the service providers to channel preference is low, the linear allocation mechanism is the optimal allocation strategy of the service providers, and vice versa, the weighted average allocation mechanism is the optimal mechanism. Copyright ©2022 Control and Decision.