Analysis for Multi-Channel Retailer Competitive Game

The advent of the E-retailer pricks up the competition between retailers. We consider the pricing problem when the traditional retailer faces the potential entry menace from the E-retailer. We suppose the online traditional retailer prices the same to the two channels of itself which are the retailing channel and online channel. The traditional retailer combines two channels to compete with the E-retailer. The research is done under the background above mentioned, Hoteling model and Game Theory are used to discuss competitively pricing problem for multi-channel including Internet channel. We show when the traditional retailer can introduce the online channel. Then the E-retailer can make the decision whether or not to enter.