A two-period pricing model with hunger marketing strategy

Purpose: This paper aims to investigate the effect of hunger marketing strategy on supply chain pricing and coordinate the supply chain through a two-period pricing model. Design/methodology/approach: According to a two-period pricing model with hunger marketing strategy, the authors investigate two different scenarios: the centralized system and the decentralized system. The optimal or equilibrium solutions are calculated and compared in two different scenarios. Findings: First, the hunger marketing strategy can improve the total profit of the supply chain by increasing the retail price and the total sales volume. Second, the hunger marketing strategy aggravates the double marginalization effect. Third, the authors introduce the revenue-sharing contract and characterize the conditions under which the revenue-sharing contract can coordinate the supply chain and be accepted by both the members. Research limitations/implications: First, the authors suppose the same retail price in two periods for mathematic simplicity; second, they do not consider the discount factor for the revenue during the two periods. Practical implications: This paper provides a guide to policymakers in terms of product pricing and supply rate. Originality/value: First, the authors suppose the same retail price in two periods for mathematic simplicity; second, they do not consider the discount factor for the revenue during the two periods.