Demand Management Opportunities in E-fulfillment: What Internet Retailers Can Learn from Revenue Management

Niels Agatz, Ann Melissa Campbell, Moritz Fleischmann, Jo van Nunen and Martin Savelsbergh

ERIM Report Series Research in Management from Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam

Abstract: In this paper, we explain how Internet retailers can learn from proven revenue management concepts and use them to reduce costs and enhance service. We focus on attended deliveries as these provide the greatest opportunities and challenges. The key driver is service differentiation. Revenue management has shown that companies can do much better than a one-size-fits-all first-come-first-serve strategy when selling scarce capacity to a heterogeneous market. Internet retailers have strong levers at their disposal for actively steering demand, notably the offered delivery time windows and their associated prices. Unlike traditional revenue management, these demand management decisions affect both revenues and costs. This calls for a closer coordination of marketing and operations than current common practice.

Keywords: E-fulfillment; demand management; home delivery; ketenbeheer; marketing-operations interface; revenue management (search for similar items in EconPapers)
JEL-codes: D4 L11 M M11 R4 (search for similar items in EconPapers)
Date: 2008-04-25
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ems:eureri:12244

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