Maximize Expected Profits by Dynamic After-Sales Service Investment Strategy Based on Word-of-Mouth Marketing in Social Network Shopping

Ying Yu, Jiaomin Liu, Jiadong Ren, Qian Wang, Cuiyi Xiao and Sameh S. Askar

Complexity, 2021, vol. 2021, 1-15

Abstract: This paper discusses how word-of-mouth marketing affects the profits of product sales in social network-based shopping under good after-sales service. First, a new word-of-mouth communication model based on silent evaluation, positive evaluation, and negative evaluation is proposed. Second, we use the way of increasing after-sales service to achieve high praise and thereby maximize the expected profits. Thus, the proportion control problem of after-sales service investment is modeled as an optimal control problem. Third, the existence of optimal control is proved, and an optimal control strategy for dynamic proportion of after-sales service investment is proposed. Fourth, through data simulation of different real-world networks, it is verified that the expected profits under the dynamic after-sales service strategy is higher than that under any uniform control strategy. Finally, sensitivity analysis is performed to explore how different parameters affect the expected profits.

Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:hin:complx:4237712

DOI: 10.1155/2021/4237712

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