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Remanufacturing, Third-Party Competition, and Consumers' Perceived Value of New Products

In this paper, we investigate whether and how the presence of remanufactured products and the identity of the remanufacturer influence the perceived value of new products through a series of behavioral experiments. Our results demonstrate that the presence of products remanufactured and sold by the...

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Published in:	Management science 2015-01, Vol.61 (1), p.60-72
Main Authors:	Agrawal, Vishal V., Atasu, Atalay, van Ittersum, Koert
Format:	Article
Language:	English
Subjects:	Analysis behavioral operations closed-loop supply chains Competition Consumer behavior Consumers Contests Customer relations Market value OEMs (Original equipment manufacturers) Political parties Product introduction Production management Profits Remanufacturing
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creator	Agrawal, Vishal V. Atasu, Atalay van Ittersum, Koert
description	In this paper, we investigate whether and how the presence of remanufactured products and the identity of the remanufacturer influence the perceived value of new products through a series of behavioral experiments. Our results demonstrate that the presence of products remanufactured and sold by the original equipment manufacturer (OEM) can reduce the perceived value of new products by up to 8%. However, the presence of third-party-remanufactured products can increase the perceived value of new products by up to 7%. These results suggest that deterring third-party competition via preemptive remanufacturing may reduce profits, whereas the presence of third-party competition may actually be beneficial for an OEM. This paper was accepted by Serguei Netessine, operations management.
doi_str_mv	10.1287/mnsc.2014.2099
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source	International Bibliography of the Social Sciences (IBSS); INFORMS journals; BSC - Ebsco (Business Source Ultimate); JSTOR
subjects	Analysis behavioral operations closed-loop supply chains Competition Consumer behavior Consumers Contests Customer relations Market value OEMs (Original equipment manufacturers) Political parties Product introduction Production management Profits Remanufacturing
title	Remanufacturing, Third-Party Competition, and Consumers' Perceived Value of New Products
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