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DTSTAMP:20240503T215702Z
SUMMARY:Benefits of Bilateral Participation in Cooperative Advertising by B
 intong Chen\, Ph.D.\, Professor at University of Delaware
DESCRIPTION: \n\nAbstract Unilateral participation in cooperative (co-op) a
 dvertising\nis popular in practice and has been extensively studied in lit
 erature.\nHowever\, we show in this paper that it is in general not able t
 o\ncoordinate the distribution channel. Motivated by many franchising\nsys
 tem where franchisees are required to pay “advertisement fee”\nto the 
 franchisor for its brand advertisement\, we propose a bilateral\nparticipa
 tion co-op advertisement system for a one-manufacturer and\nmultiple retai
 ler distribution channel\, where the manufacturer’s\nnational advertisin
 g expense is also properly shared by the retailers.\nIt is shown that the 
 bilateral participation system is capable of\ncoordinating the distributio
 n channel under very a general channel\nstructure and sales response funct
 ion and can lead to a Pareto\nimprovement over any unilateral participatio
 n system. The benefits\nfrom adopting bilateral participation over unilate
 ral participation in\nco-op advertisement are then quantified under a comm
 only used additive\nsales response function with considerations of scaling
  effect of\nnumber of retailers and stealing/spillover effects among retai
 lers.\nFinally\, we examine cases when channel members’ participation ra
 tes\nand pricing are endogenously determined. In these cases\, bilateral\n
 participation no longer coordinates the channel\; nonetheless\, it leads\n
 to significantly higher channel efficiency than unilateral\nparticipation.
 \n\nBiography Bintong Chen is Professor of Business Administration and\nAs
 sociate Dean for Research for the Lerner College of Business and\nEconomic
 s at University of Delaware\, with a secondary appointment in\nthe Departm
 ent of Civil and Environmental Engineering. He received his\nPh.D. in oper
 ations management/research from the Wharton School\, M.S.\nin systems engi
 neering from the University of Pennsylvania\, and dual\nB.S. degrees in sh
 ip-building and naval architecture as well as\nelectrical engineering from
  Shanghai Jiao Tong University in China.\n\nHis research interests include
  optimization techniques and applied\nbusiness modeling. He has published 
 in many high quality academic\njournals\, including Management Science\, O
 perations Research\,\nProduction and Operations Management\, Transportatio
 n Science\,\nMathematical Programming\, SIAM Journals on Optimization\, IE
 EE\nTransaction on Automatic Control\, and his research work has been\nwid
 ely cited. He is currently a senior editor for Production and\nOperations 
 Management.\n\nHe has taught operations management/research related classe
 s at\nundergraduate\, MBA\, and Ph.D. levels. He has supervised and worked
  on\nbusiness projects for JPMorgan Chase\, AstraZeneca\, Delaware Departm
 ent\nof Transportation\, Agriculture Bank of China\, Nordstrom\, Cascade\n
 Natural Gas Corporation\, Key Bank\, Northwest Dairy Farm\, Burlington\nNo
 rthern Rail\, and AT&T. He is a board member for APICS\, the\nAssociation 
 for Operations Management.\n\nHe received the MBA teaching award at Univer
 sity of Delaware in 2013\nand several teaching\, research\, and faculty ex
 cellence awards at both\ncollege and university levels while working at Wa
 shington State\nUniversity.\n\nFor more information\, please contact Wenji
 ng Shen at\nwenjings@drexel.edu.\n 
DTSTART:20140502T170000Z
DTEND:20140502T180000Z
LOCATION:Gerri C. LeBow Hall\, 3220 Market Street\, 722\, Philadelphia\, PA
  19104
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