Value-Added Service Investment and Pricing Strategies of a Multilateral Distribution Platform Considering User-Homing in a Duopoly

Autor: Chuan Zhang, Hui-Min Ma, Min Xiao, Yu-Xin Tian, Ling-Wei Fan
Jazyk: angličtina
Rok vydání: 2019
Předmět:
Zdroj: IEEE Access, Vol 7, Pp 98340-98355 (2019)
Druh dokumentu: article
ISSN: 2169-3536
DOI: 10.1109/ACCESS.2019.2929828
Popis: In reality, there are many multilateral distribution platforms that compete with each other. There are differences in user-homing: some users belong to only one platform, while some belong to multiple platforms. In addition, to attract more consumers, these platforms often invest in value-added services (VASs). In this paper, combining utility theory and Hoteling model, we investigate the VAS investment and pricing strategies of a multilateral distribution platform with considerations of user-homing and cross-group network externalities in a duopoly. We compare two universal situations: situation ${S}$ (all consumers, advertisers and delivery staff are single-homing) and situation ${M}$ (the consumers are single-homing while the advertisers and the delivery staff are partial multi-homing). The main results are as follows: 1) the optimal transaction fee under situation ${M}$ is higher than that under situation ${S}$ ; 2) the optimal delivery fee and advertising fee under situation ${S}$ are higher than those under situation ${M}$ ; 3) there is a threshold of the marginal VAS investment cost in both two situations, below which no VAS investing is the optimal choice; and 4) the optimal profits under situation ${M}$ are higher than those under situation ${S}$ .
Databáze: Directory of Open Access Journals