Supply chain channel conflict coordination with consumer network acceptance

Purpose The purpose of this paper is an attempt to design a proper incentive coordination mechanism to deal with the channel conflicts between the traditional sales and online direct sales. Design/methodology/approach With respect to the problems of channel conflicts between the traditional sales and online direct sales, to optimize the sale system and get more profits, considering the influences of consumer network acceptance, the authors establish demand and profit function based on consumer's utility, respectively. What's more, we exploit the game theory to analyze the optional decisions of the supply chain under the incentive coordination condition and no incentive coordination condition, and then we discuss the supply chain's optimal pricing, demand, profit and compensation incentive levels with the different effect of consumer network acceptance. Findings The level of compensation incentive provided by the manufacturer is influenced by consumer network acceptance and product cost. The lower the consumer network acceptance, the better the compensation incentive coordination effect of manufacturers. Manufacturers, wholesalers, retailers and consumers are all important players in real supply chain relationships. When a manufacturer exists as a dominant role, it should pay full attention to the impact of consumer behavior on supply chain decisions. Practical implications The research can clarify the influence and mechanism of consumer behavior on supply chain channel conflict coordination, and deal with channel conflicts. Originality/value The proposed incentive coordination can effectively realize supply chain channel conflict resolution, and provide decision-making ideas and methods for manufacturers to develop the supply chain management of online direct sales channels.