Pricing, market coverage and capacity Can green and brown products co-exist》.pdf

European Journal of Operational Research 242 (2015) 304–315 Contents lists available at ScienceDirect European Journal of Operational Research journal homepage: /locate/ejor Interfaces with Other Disciplines Pricing, market coverage and capacity: Can green and brown products co-exist? A. Yenipazarli a,∗, A. Vakharia b,1 a Department of Logistics and Supply Chain Management, Georgia Southern University, Statesboro, GA 30460, USA b Department of Information Systems Operations Management, University of Florida, Gainesville, FL 32611, USA a r t i c l e i n f o a b s t r a c t Article history: Environmental strains are causing consumers to trade up to greener alternatives and many brown products Received 26 September 2013 are losing market coverage to premium-priced green rivals. In order to tackle this threat, many companies Accepted 23 September 2014 currently offering only brown products are contemplating the launch of a green product to complement their Available online 18 October 2014 product portfolio. This paper provides strategic insights into and tactical ramifications of expanding a brown Keywords: product line with a new green product. Our analysis explicitly incorporates a segmented consumer market OR in marketing where individual consumers may value the same product differently, the economies of scale and the learning Sustainable operations effects associated with new green products, and capacity constraints for