Bundling and pricing of product with after-sale services

DOI10.1504/IJOR.2009.026245MaRDI QIDQ840629zbMATH OpenOpenAlexFDO

Authors N. E. Zubov

Publication date 13 September 2009

Published in International Journal of Operational Research (Search for Journal in Brave)

Full work available at URL https://doi.org/10.1504/ijor.2009.026245

zbMATH Keywords

after-sale servicescomplex productsduopolydurable productsmaintenancemanufacturing service integrationmonopolynon-cooperative gameproduct bundlingproduct pricingrepairsub-game perfect equilibrium

Mathematics Subject Classification ID

Management decision making, including multiple objectives (90B50)

Review text

Summary: Bundling is the sale of two or more products in combination as a package. In this paper, we consider the bundling and pricing of a complex durable product with after-sales repair and maintenance services. Product and service are two different, but related markets for this scenario. The problems of bundling and pricing are considered for two product market structures: monopoly and duopoly. In the monopoly case, the decision framework is an optimisation problem, whereas for the duopoly, the strategic interactions of the two firms are modelled as a two-stage non-cooperative game. These decision frameworks enable manufacturing firms to decide upon the product-service bundling and pricing.

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