Optimal bundle composition in competition for continuous attributes

摘要: Abstract We propose a model to design bundles’ composition under competition, quantifying its effect in terms of profit and market share game among competing firms. According our literature review, no previous models on optimal bundle can handle the competition as we do this paper. Besides, explain how firm designing multiple bundles with equal price obtains replication identical an artificially increased estimation firm’s share, which is consequence well-known Independence Irrelevant Alternatives Property. To mitigate effect, use Constrained Multinomial Logit Model, induces differentiation through soft constraints that represent minimum quantity attributes offered bundles. Although methodology helps, implies more effort estimate parameters; nevertheless, these are feasible be assessed. Firms identify they should focus their commercial efforts, given characteristics consumers.