Blockchain-enabled crypto-coordination mechanism in O2O era

Abstract

An online-to-offline (O2O) coordination mechanism becomes inevitable to sustain profits or benefits for all the supply chain participants when a manufacturer introduces an online channel that competes with the offline channel of the retailer. We propose a crypto-coordination mechanism to alleviate O2O competition by delivering financial support to the retailer through the manufacturer’s crypto-token reward to achieve Pareto results. The results indicate that the crypto-coordination mechanism mitigates O2O competition and benefits all supply chain participants. It promotes coordination through token rewards and ensures higher profits for all supply chain stakeholders to sustain competing channels. Notably, increasing the intensity of competition among channels drives higher profits, validating the effectiveness of the proposed coordination mechanism. The findings of this study deliver critical insights into the market dynamics under O2O competition. Additionally, they are of practical significance in enhancing coordination among competing channels. These insights contribute to literature and practice alike.