Pricing strategy for remanufactured products based on consumer preference

Abstract

With continuous deepening of China's sustainable development strategy, the recycling of waste materials gradually becomes an effective way to protect the environment, promote resource regeneration and save costs. It is vital for the firms to decide their pricing strategy of remanufactured products, which impacts the sales performance of new products and remanufactured products. This paper considers remanufactured product heterogeneity and consumer preference by introducing the advertising effectiveness and consumer quality expectations coefficient and builds a Static Game Model and a Two-stage Dynamic Model. Then numerical simulation analysis on coefficient of consumer quality expectations is conducted for further study. Research findings show that the consumer quality expectations coefficient has various impacts on manufacturer's price decisions and profits.