Assortment optimization under the multinomial logit model with product synergies

Venus Lo; Huseyin Topaloglu

doi:10.1016/j.orl.2019.09.009

Author(s)

Venus Lo
Huseyin Topaloglu

Detail(s)

Original language	English
Pages (from-to)	546-552
Journal / Publication	Operations Research Letters
Volume	47
Issue number	6
Online published	23 Sept 2019
Publication status	Published - Nov 2019
Externally published	Yes

Link(s)

DOI	DOI https://doi.org/10.1016/j.orl.2019.09.009 Final Published version
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Attachment(s)	Documents 37608395.pdf Post-print, 480 KB, PDF Publisher's Copyright Statement © 2019. This manuscript version is made available under the CC-BY-NC-ND 4.0 license https://creativecommons.org/licenses/by-nc-nd/4.0/
Link to Scopus	https://www.scopus.com/record/display.uri?eid=2-s2.0-85072861233&origin=recordpage
Permanent Link	https://scholars.cityu.edu.hk/en/publications/publication(a39ddfae-ebd2-4214-a4ab-976ab0032d88).html

Abstract

In synergistic assortment optimization, a product’s attractiveness changes as a function of which other products are offered. We represent synergy structure graphically. Vertices denote products. An edge denotes synergy between two products, which increases their attractiveness when both are offered. Finding an assortment to maximize retailer’s expected profit is NP-hard in general. We present efficient algorithms when the graph is a path, a tree, or has low treewidth. We give a linear program to recover the optimal assortment for paths.