Precommitment in Competing Vertical Chains

The design of distribution channels is an important marketing decision since a revision implies costly reorganization. Hence, it makes sense to study strategic motives of alternative distribution devices. A precommitment is a strategic move that affects the other players' expectations on how oneself will behave and thus induces them to choose in one's own favor (Schelling, 1960). How these tactics can be used by firms to favorably influence competition between vertical chains is the topic of the literature reviewed in this survey. Copyright 1998 by Blackwell Publishers Ltd