摘要： This paper investigates how a fast-fashion retailer should choose between a basic design and an innovative design in enhancing an existing product. While the extant literature models enhanced design to be a deterministic increase in quality, our paper implicitly considers the value of “fashion” that influences the consumers’ perception of the product enhancement. We assume that the overall design enhancement is affected by two key attributes. The first attribute is product quality, which is the firm’s decision variable. The second attribute is trendiness, which is an uncertain, exogenous parameter. The two design strategies are differentiated by the trendiness attribute, as the fashion uncertainty only impacts the innovative design but not the basic design. According to our analysis, given that the innovative design turns out to be unpopular, a higher level of fashion uncertainty makes it more likely for the firm to use a flexible offering strategy to abandon the enhanced product, as opposed to selling the enhanced product at a markdown price. Interestingly, when the innovative design turns out to be trendy, this flexible offering strategy gives the innovative design an edge over the basic design due to its much higher level of overall enhancement. Therefore, a higher level of fashion uncertainty makes the innovative design a more preferred choice. We also find that the design and production costs have opposite effects on the optimal design enhancement strategy. As the design cost becomes more important, the basic design is more preferred; as the unit production cost becomes more important, the innovative design is more preferred. |
报告人简介： Professor Shuya Yin joined the Merage School faculty in 2005. Her research addresses problems in supply chains by using non-cooperative and cooperative game theory, including product returns, secondary markets, joint selling and group buying, and distribution channel strategies. Professor Yin has published papers in Management Science, Manufacturing and Service Operations Management (MSOM), Marketing Science, Operations Research, and Production and Operations Management. She currently serves as a Senior Editor for Production and Operations Management. She received her bachelor’s and master’s degrees from Southeast University in Nanjing, China, and her PhD in management science from the University of British Columbia in Canada. |
