AdONE Seminar - Monday, May 13, 2024: Prof. Kejia Hu (University of Oxford)

The Impact of Financial Incentives in Instant Retail: An Empirical Investigation

Problem definition: Delivery speed is crucial for service quality in instant retail. To address the frequently occurring delays due to driver shortage, platforms employ financial incentives to dynamically reallocate drivers. Considering the scarcity of empirical research on financial incentives in instant retail, this study examines its direct-impact and spillover-impact from a network perspective, using large transactional datasets from a leading instant retail firm in China.

Methodology and results: First, we employ a regression discontinuity design to identify the influence of financial incentives on focal stores’ order acceptance speed. Our results show that financial incentives significantly reduce the order acceptance duration by 23.66%. Second, from a network perspective, we employ propensity score matching to examine the spillover-impact of the neighboring stores’ financial incentives on the focal store. Interestingly, our findings reveal opposing impacts that depend on the focal store’s status. Specifically, the nearest store’s financial incentives cause a longer driver’s order acceptance duration at the focal store without financial incentives; however, the opposite spillover-effect is observed at the focal store with financial incentives. To better understand the underlying mechanisms, we identify the siphon effect and clustering effect as the key drivers of this phenomenon. Our counterfactual analysis suggests that compared

to the practice, optimizing financial incentives considering network effects could reduce the associated cost by an average of 16.23%, while also decreasing total order acceptance duration by an average of 1.45%.

Managerial implications: Our study provides essential insights for crowdsourced delivery platforms in instant retail. To enhance order acceptance speed, it’s critical for platforms to extend incentives beyond focal stores and capitalize on surrounding ones to promote a clustering effect, while being mindful of the potential siphon effect. In addition, platforms should consider the interplay between nearby stores, particularly store type consistency and distance, when formulating incentive strategies to boost operational efficiency and cost-effectiveness.

Date: May 13, 2024

Time: 5 pm, s.t.

Place: Arcisstr. 21, 80333 München, room 2770 (Hörsaal 0507.02.770)

 

AdONE Seminar - Monday, June 3, 2024: Prof. Laura Sanità (Bocconi University)

The Simplex method: analysis and challenges 

The Simplex method is one of the most popular algorithms to solve linear programs (LPs).
Starting at an extreme point solution of an LP, it performs a sequence of basis exchanges (called pivots) that allows one to move to an adjacent extreme point solution along an improving edge-direction of the underlying polyhedron. Despite decades of study, it is still not known whether there exists a pivot rule that guarantees it will always reach an optimal solution with a polynomial number of steps.
This talk will focus on recent developments and results regarding the analysis of the Simplex algorithm's performance.

Date: June 3, 2024

Time: 5 pm, s.t.

Place: Garching, room tba

 

AdONE Seminar - Thursday, June 13, 2024: Prof. Vijay Vazirani (University of California, Irvine)

Date: June 13, 2024

Time: 4:00 pm, s.t.

Place: Boltzmannstr. 3, 85748 Garching, room 00.04.011, MI Hörsaal 2 (5604.EG.011)

 

AdONE Seminar - Thursday, June 24, 2024: Breno Serrano de Araujo (TUM, AdONE)

Date: June 24, 2024

Time: 5 pm, s.t.

Place: Arcisstr. 21, 80333 München, room 2770 (Hörsaal 0507.02.770)

 

AdONE Seminar - Thursday, July 15, 2024: Nicolas Kuttruff (TUM, AdONE)

Date: July 15, 2024

Time: 5 pm, s.t.

Place: Arcisstr. 21, room tba