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2003 IEEE/WIC International Conference on Web Intelligence (WI'03)
Bundling and Pricing for Information Brokerage: Customer Satisfaction as a Means to Profit Optimization
Halifax, Canada
October 13-October 17
ISBN: 0-7695-1932-6
J.A. J.A. La Poutré, CWI and Eindhoven University of Technology
Traditionally, the study of on-line dynamic pricing and bundling strategies for information goods is motivated by the value-extracting or profit-generating potential of these strategies. In this paper we discuss the relatively overlooked potential of these strategies to on-line learn more about customers? preferences. Based on this enhanced customer knowledge an information broker can — by tailoring the brokerage services more to the demand of the various customer groups — persuade customers to engage in repeated transactions (i.e., generate customer lock-in). To illustrate the discussion, we show by means of a basic consumer model how, with the use of on-line dynamic bundling and pricing algorithms, customer lock-in can occur. The lock-in occurs because the algorithms can both find appropriate prices and (from the customers? perspective) the most interesting bundles. In the conducted computer experiments we use an advanced genetic algorithm with a niching method to learn the most interesting bundles efficiently and effectively. brokerage; recommender systems.
Citation:
D.J.A. Somefun, J.A. J.A. La Poutré, "Bundling and Pricing for Information Brokerage: Customer Satisfaction as a Means to Profit Optimization," wi, pp.182, 2003 IEEE/WIC International Conference on Web Intelligence (WI'03), 2003
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