Online Bargaining as a Form of Dynamic Pricing and theSellers’A dvantage from Information Asymmetry

摘要

Among the means of implementing dynamic pricing strategies in e-commerce, online bargaining is found to be better thanrnrevenue management and online auction, because each deal actually reaches a “win-win” situation for both the buyer and thernseller in the sense that the mutually agreed deal price is higher than the seller’s reserved price but lower than the buyer’srnreserved price. Such feature brings profit to the seller, as well as savings to the buyer. Meanwhile when bargaining online,rnthere is an information asymmetry between the seller side, I.e. the company side, and the buyer side, which grants a greatrnadvantage to the sellers over the buyers. This information asymmetry can be captured and exploited for financial gainsrnthrough adopting a properly designed online bargaining algorithm.