Cooperative Advertising in Supply Chain under Demand Uncertainty

This paper studies advertising strategy in a two-echelon supply channel with single manufacturer and single retailer.When the market demand is uncertain,the manufacturer's and retailer's optimal advertising strategies of Stackelberg game and Nash cooperative game are investigated,respectively.It is shown that all the advertising level,ordering quantity and system profit when the members choose cooperative strategy are larger than those without cooperation.In Stackelberg game,the manufacturer would provide a potion of retailer's advertising level under a certain condition.Further,the result that cooperative game equilibrium has more Pareto advantage over non-cooperative game equilibrium is presented,and the surplus is distributed by Rubinstein bargaining model.Finally,numerical examples are given to illustrate and verify the conclusions.