Title: New Product Introductions with Unique and Common Features
Speaker: Burak Çelik
Time: February 2, 2023, 14:00
Thesis Committee Members:
Prof. Dr. Barış Tan (Advisor, Koç University)
Prof. Dr. Justus Arne Schwarz (University of Regensburg)
Prof. Dr. Fikri Karaesmen (Koç University)
Prof. Dr. Gürhan Kök (Koç University)
Prof. Dr. Taner Bilgiç (Boğaziçi University)
Firms have to determine the right features and price for their new products as they introduce new ones to the market. While doing so, they are challenged to respond to the changes whether it is coming from their customers or competitors. In this dissertation, we focus on the problem of determining the optimal features of new products to be introduced into the market and its pricing as well as whether to discontinue the old product or keep it with the new one in case of a monopoly.
We first focus on a monopolistic environment and consider the firm’s problem of determining the optimal unique and common features for its new product given an existing product offered by the same firm, setting the optimal prices of both products, and finally deciding whether to still offer the old product alongside with the new one. We then consider the problem of determining the features and prices of two competing firms’ products in a duopoly where the firms introduce their products sequentially. The first firm introduces a product by determining the features and the price of its new product by anticipating the second firm’s new product. The second firm then competes with both the product and price by introducing its new product after observing the first firm’s product. We also comment on the case in which the second firm cannot change its offered product and consequently only responds with a pricing decision. In the last part, we further explore product entry decisions with feature and quality level selections in monopoly and duopoly settings by extending the analysis from the second part.