Influence of anticipated regret on the pricing decision of supply chain enterprises under price discount

The price discounts of enterprises is more likely to cause consumers to feel regret about original price products and discount products. For this problem, the impact of anticipated regrets on pricing decisions of supply chain enterprises under the price discounts was studied. Taking into account price discounts and the consumer's anticipated regret, the demand function of the original price products and the discount products was deduced. From the perspective of the supply chain, the game theory was used to construct and solve three supply chain game models of power structures that were no leader, manufacturer and retailer respectively. The model comparison and numerical simulation were utilized to analyze the impact of regret sensitivity coefficient and consumer heterogeneity on the pricing decision of supply chain enterprises. The results showed that the price of products increased first and then decreased with increasing of regret sensitivity coefficient and consumer heterogeneity affected by regret expectations under price discounts, and the price was highest under the manufacturer's leadership structure. When the regret sensitivity coefficient and consumer heterogeneity were lower, the supply chain member companies adopted a skimming pricing strategy. When the regret sensitivity coefficient and consumer heterogeneity were higher, the supply chain member companies adopted a penetration pricing strategy. Stimulated by price discounts, manufacturers adopted a commitment-based advertising strategy for high-regret consumers, and retailers adopted a reputation pricing strategy. For high preference differential products, manufacturers adopted a differentiated customization strategy and retailers adopted a differential pricing strategy. © 2021, Editorial Department of CIMS. All right reserved.