Retailers' Price Adjustment Policy Boosts Revenue and Outsmarts Strategic Consumers
Retailers offering price adjustment protection policies can actually increase revenue, especially when consumers act strategically. This policy doesn't harm revenue for perishable products and can even boost it for high-demand scenarios. The optimal duration of the policy and timing of price markdowns are crucial for maximizing profits. In situations where many consumers are strategic and optimistic, the positive impact on revenue is even greater.