Table 1 Consumer type and utility expression

A

Consumers who visit and purchase from the offline retailer if satisfied with the product

U_a = θ(V − p_a) − tx

H ₁

Consumers who purchase the product from online store of the hybrid retailer

\( {U}_{h1}=\theta \left(V-{p}_h\right)-\left(1-\theta \right)\updelta {p}_h-m\left(\frac{1}{2}-x\right) \)

H ₂

Consumers who purchase the product from physical store of the hybrid retailer

\( {U}_{h2}=\theta \left(V-{p}_h\right)-t\left(\frac{1}{2}-x\right) \)

S ₁

Consumers who browse in the offline retailer and then switch to the online store for purchase

\( {U}_{s1}=\theta \left(V-{p}_h-m\left(\frac{1}{2}-x\right)\right)- tx \)

S ₂

Consumers who browse in physical store of the hybrid retailer and then switch to the pure offline retailer for purchase

\( {U}_{s2}=\theta \left(V-{p}_a- tx\right)-t\left(\frac{1}{2}-x\right) \)