Dynamic Pricing Strategy with Demand Learning Based on Competitive Markets
Li Hao
Peng Qing
Abstract：Analyzing why retailers have to adopt dynamic pricing through demand learning to maximize their revenue where there is demand uncertainty of the customer arrival rate and the competitive markets with multiple competing retailers , a dynamic pricing model by dynamic programming and game theory is presented .Based on competitive markets and demand learning background , the existence of Nash Equilib-rium is obvious .It is found that the profit of retailers is proportional to the equilibrium price where there are multiple equilibrium prices .Numerical experiments are conducted to analyze the effect of demand learning and calculate the price equilibrium .A managerial insight is derived from numerical experiments .
Keywords：demand learningcompetitiondynamic pricingrevenue management
Publication Date：2015-01-01
Online Publishing Date：2025-08-15(First online date of this platform, not the publication date of the document)
Pages：6( 87-92 )