Category captainship: delegation, participant selection and category extensions

Bushey, Erik

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https://hdl.handle.net/2142/50568 Copy

Description

Title

Category captainship: delegation, participant selection and category extensions

Author(s)

Bushey, Erik

Issue Date

2014-09-16

Director of Research (if dissertation) or Advisor (if thesis)

Palekar, Udatta S.

Doctoral Committee Chair(s)

Palekar, Udatta S.

Committee Member(s)

• Qualls, William J.
• Yuan, Hong
• Lewis, Michael

Department of Study

Business Administration

Discipline

Business Administration

Degree Granting Institution

University of Illinois at Urbana-Champaign

Degree Name

Ph.D.

Degree Level

Dissertation

Keyword(s)

• Category captainship
• category captain
• category management
• delegation
• game theory
• retailing
• distribution channels
• supply chain
• store brands
• product line assortments

Abstract

This dissertation is a collection of three essays which study different aspects of category captainship, a new and increasingly popular category management strategy. In this strategy retailers delegate their control of product categories to one of the manufacturers operating within that category, who is referred to as the ``category captain''. As this practice is new, many answers regarding the optimal implementation of category captainship remain unanswered. In the first essay we study a model of category captainship where manufacturers are asymmetric with respect to how many brand-loyal consumers they each posses and retailers are only able to delegate the single responsibility of the setting of retail prices. Our findings shed some light on the role of manufacturer size in the category captain selection process. In the second essay we study a model of category captainship where retailers are able to delegate more than just control of retail pricing to symmetric manufacturers. Specifically, we allow retailers to also delegate control of two types of in-store marketing activities: brand marketing activities and category marketing activities. We find that retailers' profits from the use of a category captain increase with the number of responsibilities delegated. In the final essay we study a model of category captainship where the product category contains both high and low quality products, where low quality products can be either product line extensions or store brands. We find that the type of low quality product plays an important role in how category captainship affects both category profit and consumer surplus, two attributes which are generally thought to be enhanced by the use of a category captain.

Graduation Semester

2014-08

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http://hdl.handle.net/2142/50568

Copyright and License Information

Copyright 2014 Erik Bushey

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