The use of a durable good is limited by both its physical life and usable life. For example, an electric-car battery can last for 5 years (physical life) or 100,000 miles (usable life), whichever comes first. We propose a framework for examining how a profit-maximizing firm might choose the...

Conventional wisdom in marketing holds that retailer forward buying (1) is a consequence of manufacturer trade promotions and (2) stockpiling units helps the retailer but hurts the manufacturer. This paper provides a deeper understanding of forward buying by analyzing it within the context of...

Firms are increasingly seeking to harness the potential of social networks for marketing purposes. Therefore, marketers are interested in understanding the antecedents and consequences of relationship formation within networks and in predicting interactivity among users. The authors develop an...

Driven by the low transaction costs and interactive nature of the internet, customer participation in the price-setting process has increased. Today, platforms such as eBay have popularized online auctions on a global scale, Priceline has made headlines with its name-your-own-price (NYOP)...

Service providers, such as cell phone carriers, often offer three-part tariff plans that consist of three levers: A fixed fee, an allowance of free units, and a price per each unit above the allowance. In previous studies the optimal three-part tariff contract was characterized using the...

To many managers, the idea of involving customers in pricing decisions seems counterproductive. For most companies, pricing is a sensitive, private affair. But it may be time to reexamine those ideas. Letting customers have input on prices provides opportunities for customization and can promote...