 The Benefits of Downstream Information AcquisitionMarketing Science, 2009, vol. 28, issue 3, 457-471 Abstract: This study investigates the effects of turning terabytes of raw retail data into managerial insights (i.e., downstream information acquisition) in a strategic channel setting. Two effects of information acquisition are identified—the effect that improves retail pricing decision making in an uncertain environment, and the effect whereby the retailer voluntarily discloses the acquired private information to influence the upstream manufacturer's wholesale pricing behavior. It is shown that the efficiency effect benefits the retailer without affecting the manufacturer, while the strategic effect works to the detriment of the retailer but to the advantage of the manufacturer. Nevertheless, unobservable information acquisition can mitigate the retailer's loss and the manufacturer's benefit from the strategic effect of information disclosure. Moreover, an increasing expected information acquisition cost may benefit the retailer, when that cost is low and information acquisition is unobservable to the manufacturer. The implications of this paper can shed light on how firms interact in a channel where the downstream market is data intensive, but information gleaning is costly. Keywords: disclosure; distribution channel; information acquisition; voluntary information sharing (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:inm:ormksc:v:28:y:2009:i:3:p:457-471 Access Statistics for this article More articles in Marketing Science from INFORMS Contact information at EDIRC. |
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