Title

Is Information Sharing Profitable in E-Business Age?

Document Type

Article

Publication Date

1-1-2012

Abstract

Is information sharing profitable for the competitive channel retailers? In order to answer this question, we use a game-theoretic model with Bayesian forecasting to investigate the benefits of cooperative information sharing for the online and traditional retailers. We assume that online and traditional retailers have their own private forecasting information about the market demand (asymmetric information). Our results show that when the online and traditional retailers share their private forecasting information, both retailers will be better off if they have a close forecast. Furthermore, if retailer individual information is less accurate and channel competition is more intense, information sharing becomes much more necessary to each retailer. Based on our results, optimal marketing strategies are derived and important managerial implications are provided.

DOI

10.1504/IJADS.2012.044943

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